Skeletal muscle can be engineered by converting dermal precursors into muscle progenitors and differentiated myocytes. However, the efficiency of muscle development remains relatively low and it is currently unclear if this is due to poor characterization of the myogenic precursors, the protocols used for cell differentiation, or a combination of both. In this study, we characterized myogenic precursors present in murine dermospheres, and evaluated mature myotubes grown in a novel three-dimensional culture system. After 5-7 days of differentiation, we observed isolated, twitching myotubes followed by spontaneous contractions of the entire tissue-engineered muscle construct on an extracellular matrix (ECM). In vitro engineered myofibers expressed canonical muscle markers and exhibited a skeletal (not cardiac) muscle ultrastructure, with numerous striations and the presence of aligned, enlarged mitochondria, intertwined with sarcoplasmic reticula (SR). Engineered myofibers exhibited Na(+)- and Ca(2+)-dependent inward currents upon acetylcholine (ACh) stimulation and tetrodotoxin-sensitive spontaneous action potentials. Moreover, ACh, nicotine, and caffeine elicited cytosolic Ca(2+) transients; fiber contractions coupled to these Ca(2+) transients suggest that Ca(2+) entry is activating calcium-induced calcium release from the SR. Blockade by d-tubocurarine of ACh-elicited inward currents and Ca(2+) transients suggests nicotinic receptor involvement. Interestingly, after 1 month, engineered muscle constructs showed progressive degradation of the myofibers concomitant with fatty infiltration, paralleling the natural course of muscular degeneration. We conclude that mature myofibers may be differentiated on the ECM from myogenic precursor cells present in murine dermospheres, in an in vitro system that mimics some characteristics found in aging and muscular degeneration.