Folic acid (FA) is well known to prevent neural tube defects (NTDs), but we do not know why many human NTD cases still remain refractory to FA supplementation. Here, we investigate how the DNA demethylase TET1 interacts with maternal FA status to regulate mouse embryonic brain development. We determined that cranial NTDs display higher penetrance in non-inbred than in inbred Tet1-/- embryos and are resistant to FA supplementation across strains. Maternal diets that are either too rich or deficient in FA are linked to an increased incidence of cranial deformities in wild type and Tet1+/- offspring and to altered DNA hypermethylation in Tet1-/- embryos, primarily at neurodevelopmental loci. Excess FA in Tet1-/- embryos results in phospholipid metabolite loss and reduced expression of multiple membrane solute carriers, including a FA transporter gene that exhibits increased promoter DNA methylation and thereby mimics FA deficiency. Moreover, FA deficiency reveals that Tet1 haploinsufficiency can contribute to DNA hypermethylation and susceptibility to NTDs. Overall, our study suggests that epigenetic dysregulation may underlie NTD development despite FA supplementation.