Muscle and its connective tissue are intimately linked in the embryo and in the adult, suggesting that interactions between these tissues are crucial for their development. However, the study of muscle connective tissue has been hindered by the lack of molecular markers and genetic reagents to label connective tissue fibroblasts. Here, we show that the transcription factor Tcf4 (transcription factor 7-like 2; Tcf7l2) is strongly expressed in connective tissue fibroblasts and that Tcf4(GFPCre) mice allow genetic manipulation of these fibroblasts. Using this new reagent, we find that connective tissue fibroblasts critically regulate two aspects of myogenesis: muscle fiber type development and maturation. Fibroblasts promote (via Tcf4-dependent signals) slow myogenesis by stimulating the expression of slow myosin heavy chain. Also, fibroblasts promote the switch from fetal to adult muscle by repressing (via Tcf4-dependent signals) the expression of developmental embryonic myosin and promoting (via a Tcf4-independent mechanism) the formation of large multinucleate myofibers. In addition, our analysis of Tcf4 function unexpectedly reveals a novel mechanism of intrinsic regulation of muscle fiber type development. Unlike other intrinsic regulators of fiber type, low levels of Tcf4 in myogenic cells promote both slow and fast myogenesis, thereby promoting overall maturation of muscle fiber type. Thus, we have identified novel extrinsic and intrinsic mechanisms regulating myogenesis. Most significantly, our data demonstrate for the first time that connective tissue is important not only for adult muscle structure and function, but is a vital component of the niche within which muscle progenitors reside and is a critical regulator of myogenesis.