One of the hurdles for clinical application of induced pluripotent stem cells (iPSC) is the low efficiency and slow process of reprogramming, a process of converting somatic cells, such as skin fibroblasts, into embryonic stem cell-like state. In this study, we identified a novel small molecule compound, termed Oct4-activating compound 1 (OAC1), that activates the promoters of both Oct4 and Nanog, two molecules that play important role in maintaining embryonic stem cell-like state. Furthermore, when added to the reprogramming mixture along with the quartet reprogramming factors (Oct4, Sox2, c-Myc, and Klf4), OAC1 enhanced the efficiency and accelerated the process of converting fibroblast cells into embryonic stem cell-like state. The iPSC colonies derived using the Oct4-activating compounds along with the quartet factors exhibited typical embryonic stem cell morphology, gene-expression pattern, and developmental potential. OAC1 seems to enhance reprogramming efficiency in a unique manner, independent of the known signaling pathways that facilitate the reprogramming process.