Polycomb repressive complex 2 (PRC2) places H3K27me3 at developmental genes and is causally implicated in keeping bivalent genes silent. It is unclear if that silence requires minimum H3K27me3 levels and how the mark transmits faithfully across mammalian somatic cell generations. Mouse intestinal cells lacking EZH2 methyltransferase reduce H3K27me3 proportionately at all PRC2 target sites, but ∼40% uniform residual levels keep target genes inactive. These genes, derepressed in PRC2-null villus cells, remain silent in intestinal stem cells (ISCs). Quantitative chromatin immunoprecipitation and computational modeling indicate that because unmodified histones dilute H3K27me3 by 50% each time DNA replicates, PRC2-deficient ISCs initially retain sufficient H3K27me3 to avoid gene derepression. EZH2 mutant human lymphoma cells also require multiple divisions before H3K27me3 dilution relieves gene silencing. In both cell types, promoters with high basal H3K4me2/3 activate in spite of some residual H3K27me3, compared to less-poised promoters. These findings have implications for PRC2 inhibition in cancer therapy.