The first hematopoietic stem and progenitor cells are generated during development from hemogenic endothelium (HE) through trans-differentiation. The molecular mechanisms underlying this endothelial-to-hematopoietic transition (EHT) remain poorly understood. Here, we explored the role of the epigenetic regulators HDAC1 and HDAC2 in the emergence of these first blood cells in vitro and in vivo. Loss of either of these epigenetic silencers through conditional genetic deletion reduced hematopoietic transition from HE, while combined deletion was incompatible with blood generation. We investigated the molecular basis of HDAC1 and HDAC2 requirement and identified TGF-β signaling as one of the pathways controlled by HDAC1 and HDAC2. Accordingly, we experimentally demonstrated that activation of this pathway in HE cells reinforces hematopoietic development. Altogether, our results establish that HDAC1 and HDAC2 modulate TGF-β signaling and suggest that stimulation of this pathway in HE cells would be beneficial for production of hematopoietic cells for regenerative therapies.