In female mouse embryos, somatic cells undergo a random form of X chromosome inactivation (XCI), whereas extraembryonic trophoblast cells in the placenta undergo imprinted XCI, silencing exclusively the paternal X chromosome. Initiation of imprinted XCI requires a functional maternal allele of the X-linked gene Rnf12, which encodes the ubiquitin ligase Rnf12/RLIM. We find that knockout (KO) of Rnf12 in female mammary glands inhibits alveolar differentiation and milk production upon pregnancy, with alveolar cells that lack RLIM undergoing apoptosis as they begin to differentiate. Genetic analyses demonstrate that these functions are mediated primarily by the paternal Rnf12 allele due to nonrandom maternal XCI in mammary epithelial cells. These results identify paternal Rnf12/RLIM as a critical survival factor for milk-producing alveolar cells and, together with population models, reveal implications of transgenerational epigenetic inheritance.