Methylation of cytosines is a major epigenetic modification in mammalian genomes. The levels and patterns of DNA methylation are the results of the opposing actions of methylating and demethylating machineries. Over the past two decades, great progress has been made in elucidating the methylating machinery including the identification and functional characterization of the DNA methyltransferases (Dnmts). However, the mechanisms of demethylation and the major players involved had been elusive. A major breakthrough came in 2009, when the ten-eleven translocation (Tet) family of proteins was discovered as 5-methylcytosine (5mC) dioxygenases that convert 5mC to 5-hydroxymethylcytosine (5hmC). Studies in the past several years have established that 5hmC serves as an intermediate in DNA demethylation and that Tet proteins have important roles in epigenetic reprogramming in early embryos and primordial germ cells. In this review, we discuss recent advances in this exciting field, focusing on the role of Tet proteins in mammalian development.