Significance During embryonic development, multipotent stem cells progressively acquire specific cell fates. The somite is an embryological structure that gives rise to different mesodermal cell types, including skeletal muscle and vascular cells of blood vessels. We show by genetic manipulation that the Notch signaling pathway promotes a vascular cell-fate choice at the expense of skeletal muscle in the mouse somite. Pax3 + cells in the adjacent somites give rise to myogenic and endothelial cells in the limbs. Gain-of-function or inhibition of Notch signaling affects this cell-fate choice prior to the migration of these somite-derived cells into the limb. This embryological role of Notch is of potential therapeutic relevance to deriving stem cells for tissue repair.