Maintenance of undifferentiated, long-lived, and often quiescent stem cells in the basal compartment is important for homeostasis and regeneration of multiple epithelial tissues, but the molecular mechanisms that coordinately control basal cell fate and stem cell quiescence are elusive. Here, we report an epithelium-intrinsic requirement for Zeb1, a core transcriptional inducer of epithelial-to-mesenchymal transition, for mammary epithelial ductal side branching and for basal cell regenerative capacity. Our findings uncover an evolutionarily conserved role of Zeb1 in promoting basal cell fate over luminal differentiation. We show that Zeb1 loss results in increased basal cell proliferation at the expense of quiescence and self-renewal. Moreover, Zeb1 cooperates with YAP to activate Axin2 expression, and inhibition of Wnt signaling partially restores stem cell function to Zeb1-deficient basal cells. Thus, Zeb1 is a transcriptional regulator that maintains both basal cell fate and stem cell quiescence, and it functions in part through suppressing Wnt signaling.