In animal models, Nipbl deficiency phenocopies gene expression changes and birth defects seen in Cornelia de Lange syndrome, the most common cause of which is Nipbl haploinsufficiency. Previous studies in Nipbl+/- mice suggested that heart development is abnormal as soon as cardiogenic tissue is formed. To investigate this, we performed single-cell RNA sequencing on wild-type and Nipbl+/- mouse embryos at gastrulation and early cardiac crescent stages. Nipbl+/- embryos had fewer mesoderm cells than wild-type and altered proportions of mesodermal cell subpopulations. These findings were associated with underexpression of genes implicated in driving specific mesodermal lineages. In addition, Nanog was found to be overexpressed in all germ layers, and many gene expression changes observed in Nipbl+/- embryos could be attributed to Nanog overexpression. These findings establish a link between Nipbl deficiency, Nanog overexpression, and gene expression dysregulation/lineage misallocation, which ultimately manifest as birth defects in Nipbl+/- animals and Cornelia de Lange syndrome.