Histone demethylase that specifically demethylates 'Lys-27' of histone H3, thereby playing a central role in histone code. Demethylates trimethylated and dimethylated H3 'Lys-27'. Plays a central role in regulation of posterior development, by regulating HOX gene expression. Involved in inflammatory response by participating in macrophage differentiation in case of inflammation by regulating gene expression and macrophage differentiation (PubMed:17825402). Plays a demethylase-independent role in chromatin remodeling to regulate T-box family member-dependent gene expression by acting as a link between T-box factors and the SMARCA4-containing SWI/SNF remodeling complex (PubMed:21095589). 2 2-oxoglutarate + N(6),N(6),N(6)-trimethyl-L-lysyl(27)-[histone H3] + 2 O2 = 2 CO2 + 2 formaldehyde + N(6)-methyl-L-lysyl(27)-[histone H3] + 2 succinate Interacts with TLE1 (PubMed:21095589). Component of the MLL4 complex, at least composed of KMT2B/MLL4, ASH2L, RBBP5, WDR5, and KDM6B (By similarity). Interacts with TBX21, SMARCA4, SMARCC1 and SMARCC2 (PubMed:21095589). By inflammatory stimuli; mediated by NF-kappa-B. Belongs to the UTX family.