AbstractFusion-positive rhabdomyosarcoma (FP-RMS) driven by the expression of the PAX3-FOXO1 (P3F) fusion oncoprotein is an aggressive subtype of pediatric rhabdomyosarcoma. FP-RMS histologically resembles developing muscle yet occurs throughout the body in areas devoid of skeletal muscle highlighting that FP-RMS is not derived from an exclusively myogenic cell of origin. Here we demonstrate that P3F reprograms mouse and human endothelial progenitors to FP-RMS. We show that P3F expression in aP2-Cre expressing cells reprograms endothelial progenitors to functional myogenic stem cells capable of regenerating injured muscle fibers. Further, we describe a FP-RMS mouse model driven by P3F expression and Cdkn2a loss in endothelial cells. Additionally, we show that P3F expression in TP53-null human iPSCs blocks endothelial-directed differentiation and guides cells to become myogenic cells that form FP-RMS tumors in immunocompromised mice. Together these findings demonstrate that FP-RMS can originate from aberrant development of non-myogenic cells driven by P3F.