A counting process senses the X chromosome/autosome ratio and ensures that X chromosome inactivation (XCI) initiates in the female (XX) but not in the male (XY) mouse embryo. Counting is regulated by the X-inactivation centre, which contains the Xist gene. Deleting 65 kb 3' to Xist in XO embryonic stem (ES) cells affects counting and results in inappropriate XCI upon differentiation. We show here that normal counting can be rescued in these deleted ES cells using cre/loxP re-insertion, and refine the location of elements controlling counting within a 20 kb bipartite domain. Furthermore, we show that the 65 kb deletion also leads to inappropriate XCI in XY differentiated ES cells, which excludes the involvement of sex-specific mechanisms in the initiation of XCI. At the chromatin level, we have found that the Xist gene corresponds to a peak of H3 Lys-4 dimethylation, which is dramatically and specifically affected by the deletion 3' to Xist. Our results raise the possibility that H3 Lys-4 dimethylation within Xist may be functionally implicated in the counting process.