Tissue development and regeneration rely on the cooperation of multiple mesenchymal progenitor (MP) subpopulations. We recently identified Hic1 as a marker of quiescent MPs in multiple adult tissues. Here, we describe the embryonic origin of appendicular Hic1 MPs and demonstrate that they arise in the hypaxial somite, and migrate into the developing limb at embryonic day 11.5, well after limb bud initiation. Time-resolved single-cell-omics analyses coupled with lineage tracing reveal that Hic1 cells generate a unique MP hierarchy, that includes both recently identified adult universal fibroblast populations (Dpt, Pi16 and Dpt Col15a1) and more specialised mesenchymal derivatives such as, peri and endoneurial cells, pericytes, bone marrow stromal cells, myotenocytes, tenocytes, fascia-resident fibroblasts, with limited contributions to chondrocytes and osteocytes within the skeletal elements. MPs endure within these compartments, continue to express Hic1 and represent a critical reservoir to support post-natal growth and regeneration.