Background:Mechanical compression of cells during mesenchymal condensation triggers cells to undergo odontogenic differentiation during tooth organ formation in the embryo. However, the mechanism by which cell compaction is stabilized over time to ensure correct organ‐specific cell fate switching remains unknown. Results: Here, we show that mesenchymal cell compaction induces accumulation of collagen VI in the extracellular matrix (ECM), which physically stabilizes compressed mesenchymal cell shapes and ensures efficient organ‐specific cell fate switching during tooth organ development. Mechanical induction of collagen VI deposition is mediated by signaling through the actin‐p38MAPK‐SP1 pathway, and the ECM scaffold is stabilized by lysyl oxidase in the condensing mesenchyme. Moreover, perturbation of synthesis or cross‐linking of collagen VI alters the size of the condensation in vivo. Conclusions: These findings suggest that the odontogenic differentiation process that is induced by cell compaction during mesenchymal condensation is stabilized and sustained through mechanically regulated production of collagen VI within the mesenchymal ECM. Developmental Dynamics, 2015. 244:713–723, 2015. © 2015 Wiley Periodicals, Inc.