In mice, the repressive histone mark H3K27me3 undergoes both region-specific inheritance and erasure during the parental-to-embryonic transition, with the underlying mechanisms poorly understood. Here, we show that PRC2, which catalyzes H3K27me3, binds both classic Polycomb targets and noncanonical H3K27me3 domains in growing oocytes but dissociates from chromatin in fully grown oocytes. After fertilization, PRC2 rebinds noncanonical H3K27me3 domains before relocating to Polycomb targets in blastocysts. Interestingly, the binding and activity of PRC2 are restricted by a maternal inhibitory factor, EZH inhibitory protein (EZHIP), which co-binds with PRC2. Upon knockout of Ezhip, hyperactive PRC2 promiscuously deposits H3K27me3 genome-wide. This overwrites H3K27me3 memories at noncanonical imprinted genes and paradoxically causes derepression of H3K27me3 targets, defective X chromosome inactivation, and diluted chromatin PRC2. H3K27me3 restoration at Polycomb targets after implantation is also attenuated, accompanied by sub-lethality. These data unveil principles of epigenetic inheritance that both insufficient and excessive heterochromatic marks cause loss of epigenetic memories and repression.