Cell polarity has a fundamental role in shaping the morphology of cells and growing tissues. Polarity is commonly thought to be established in response to extracellular signals. Here we used a minimal in vitro assay that enabled us to monitor the determination of cell polarity in myogenic and chondrogenic differentiation in the absence of external signalling gradients. We demonstrate that the initiation of cell polarity is regulated by melanoma cell adhesion molecule (MCAM). We found highly polarized localization of MCAM, Moesin (MSN), Scribble (SCRIB) and Van-Gogh-like 2 (VANGL2) at the distal end of elongating myotubes. Knockout of MCAM or elimination of its endocytosis motif does not impair the initiation of myogenesis or myoblast fusion, but prevents myotube elongation. MSN, SCRIB and VANGL2 remain uniformly distributed in MCAM knockout cells. We show that MCAM is also required at early stages of chondrogenic differentiation. In both myogenic and chondrogenic differentiation MCAM knockout leads to transcriptional downregulation of Scrib and enhanced MAP kinase activity. Our data demonstrates the importance of cell autonomous polarity in differentiation.