The maternal-to-zygotic transition (MZT) marks the period when the embryonic genome is activated and acquires control of development. Maternally inherited factors play a key role in this critical developmental process, which occurs at the 2-cell stage in mice. We investigated the function of the maternally inherited factor Stella (encoded by Dppa3) using single-cell/embryo approaches. We show that loss of maternal Stella results in widespread transcriptional mis-regulation and a partial failure of MZT. Strikingly, activation of endogenous retroviruses (ERVs) is significantly impaired in Stella maternal/zygotic knockout embryos, which in turn leads to a failure to upregulate chimeric transcripts. Amongst ERVs, MuERV-L activation is particularly affected by the absence of Stella, and direct in vivo knockdown of MuERV-L impacts the developmental potential of the embryo. We propose that Stella is involved in ensuring activation of ERVs, which themselves play a potentially key role during early development, either directly or through influencing embryonic gene expression.