Mesodermal somites are initially composed of columnar cells arranged as a pseudostratified epithelium that undergoes sequential and spatially restricted changes to generate the sclerotome and dermomyotome, intermediate structures that develop into vertebrae, striated muscles of the body and limbs, dermis, smooth muscle, and endothelial cells. Regional cues were elucidated that impart differential traits upon the originally multipotent progenitors. How do somite cells and their intermediate progenitors interpret these extrinsic cues and translate them into various levels and/or modalities of intracellular signaling that lead to differential gene expression profiles remains a significant challenge. So is the understanding of how differential fate specification relates to complex cellular migrations prefiguring the formation of body muscles and vertebrae. Research in the past years has largely transited from a descriptive phase in which the lineages of distinct somite-derived progenitors and their cellular movements were traced to a more mechanistic understanding of the local function of genes and regulatory networks underlying lineage segregation and tissue organization. In this chapter, we focus on some major advances addressing the segregation of lineages from the dermomyotome, while discussing both cellular as well as molecular mechanisms, where possible.