Faithful resetting of the epigenetic memory of a somatic cell to a pluripotent state during cellular reprogramming requires DNA methylation to silence somatic gene expression and dynamic DNA demethylation to activate pluripotency gene transcription. The removal of methylated cytosines requires the base excision repair enzyme TDG, but the mechanism by which TDG-dependent DNA demethylation occurs in a rapid and site-specific manner remains unclear. Here we show that the XPC DNA repair complex is a potent accelerator of global and locus-specific DNA demethylation in somatic and pluripotent stem cells. XPC cooperates with TDG genome-wide to stimulate the turnover of essential intermediates by overcoming slow TDG-abasic product dissociation during active DNA demethylation. We further establish that DNA demethylation induced by XPC expression in somatic cells overcomes an early epigenetic barrier in cellular reprogramming and facilitates the generation of more robust induced pluripotent stem cells, characterized by enhanced pluripotency-associated gene expression and self-renewal capacity. Taken together with our previous studies establishing the XPC complex as a transcriptional coactivator, our findings underscore two distinct but complementary mechanisms by which XPC influences gene regulation by coordinating efficient TDG-mediated DNA demethylation along with active transcription during somatic cell reprogramming.