Demethylation of transposons can activate expression of nearby genes and cause imprinted gene expression in endosperm, and it is hypothesized to lead to expression of transposon siRNAs that reinforce silencing in the next generation through transfer either into egg or embryo. Here we describe maternal derepression of R1 (mdr1), a DNA glycosylase with homology to Arabidopsis DEMETER that is partially responsible for demethylation of thousands of regions in endosperm. Maternally-expressed imprinted genes were enriched strongly enriched for overlap with demethylated regions, but the majority of genes that overlapped demethylated regions were not imprinted. Demethylated regions were depleted from the majority of repetitive DNA in the genome but enriched in a set of transposon families accounting for about a tenth of the total demethylated regions. Demethylated regions produced few siRNAs and were not associated with excess CHH methylation in endosperm or other tissues. mdr1 and its close homolog dng102 are essential factors in maternal and paternal fertility in maize, as neither double mutant microgametophytes nor megagametophytes gave rise to seeds. These data establish DNA demethylation by glycosylases as essential in maize endosperm and pollen and suggest that neither transposon regulation nor genomic imprinting are its main function.