The endometrial perivascular microenvironment is rich in mesenchymal stem-like cells that express type 1 integral membrane protein Sushi domain containing 2 (SUSD2) but the role of these cells in the decidual transformation of this tissue in pregnancy is unknown. We used an antibody directed against SUSD2 (W5C5) to isolate perivascular (W5C5(+)) and nonperivascular (W5C5(-)) fibroblasts from mid-luteal biopsies. We show that SUSD2 expression, and hence the ratio of W5C5(+):W5C5(-) cells, changes in culture depending on cell-cell contact and activation of the Notch signaling pathway. RNA sequencing revealed that cultures derived from W5C5(+) progenitor cells remain phenotypically distinct by the enrichment of novel and established endometrial perivascular signature genes. In an undifferentiated state, W5C5(+)-derived cells produced lower levels of various chemokines and inflammatory modulators when compared with their W5C5(-) counterparts. This divergence in secretomes was switched and became more pronounced upon decidualization, which transformed perivascular W5C5(+) cells into the dominant source of a range of chemokines and cytokines, including leukemia inhibitory factor and chemokine (C-C motif) ligand 7. Our findings suggest that the decidual response is spatially organized at the embryo-maternal interface with differentiating perivascular cells establishing distinct cytokine and chemokine profiles that could potentially direct trophoblast toward maternal vessels and govern local immune responses in pregnancy.