The epicardium is crucial for heart development and function, and it has also emerged as a potential source of multipotent progenitors that can contribute to heart repair. But how epicardial cells develop in humans and how they might contribute to heart regeneration is unclear, partly because methods to study them have been lacking. Here (p. 1528), Sanjay Sinha and colleagues describe a robust protocol for generating epicardial cells and their differentiated progeny from human pluripotent stem cells (HPSCs) under defined chemical conditions. They first use FGF2 and BMP4 to differentiate HPSCs to a lateral plate mesoderm intermediate. A combination of WNT, retinoic acid and BMP signals, they report, then drives differentiation to an epicardial fate. The resulting cells express epicardial-specific markers and exhibit a morphology that is characteristic of human foetal epicardial cells. The authors further demonstrate that HPSC-derived epicardial cells can undergo EMT and differentiate into smooth muscle cells and cardiac fibroblasts. Importantly, they show that, when injected into developing chick embryos, HPSC-derived epicardial cells localise to the subepicardial space and integrate into coronary vessels. This method thus provides both a novel system for understanding epicardial development in humans and a potential platform for drug screening and modelling vascular disease.