Somites are formed from the presomitic mesoderm (PSM) and give rise to the axial skeleton and skeletal muscles. The PSM is dynamic; somites are generated at the anterior end, while the posterior end is continually renewed with new cells entering from the tailbud progenitor region. Which genes control the conversion of tailbud progenitors into PSM and how is this process coordinated with cell movement? Using loss- and gain-of-function experiments and heat-shock transgenics we show in zebrafish that the transcription factor Mesogenin 1 (Msgn1), acting with Spadetail (Spt), has a central role. Msgn1 allows progression of the PSM differentiation program by switching off the progenitor maintenance genes ntl, wnt3a, wnt8 and fgf8 in the future PSM cells as they exit from the tailbud, and subsequently induces expression of PSM markers such as tbx24. msgn1 is itself positively regulated by Ntl/Wnt/Fgf, creating a negative-feedback loop that might be crucial to regulate homeostasis of the progenitor population until somitogenesis ends. Msgn1 drives not only the changes in gene expression in the nascent PSM cells but also the movements by which they stream out of the tailbud into the PSM. Loss of Msgn1 reduces the flux of cells out of the tailbud, producing smaller somites and an enlarged tailbud, and, by delaying exhaustion of the progenitor population, results in supernumerary tail somites. Through its combined effects on gene expression and cell movement, Msgn1 (with Spt) plays a key role both in genesis of the paraxial mesoderm and in maintenance of the progenitor population from which it derives.