ABSTRACT Hemangiogenic progenitors generating blood and endothelial cells are specified from FLK1-expressing (FLK1 + ) mesoderm by the transcription factor ETV2. FLK1 + mesoderm also contributes to smooth muscle and cardiomyocytes. However, the developmental process of FLK1 + mesoderm generation and its allocation to various cell fates remain obscure. Recent single cell RNA-sequencing studies of early embryos or in vitro -differentiated human embryonic stem (ES) cells have provided unprecedented information on the spatiotemporal resolution of cells in embryogenesis. These snapshots, however, lack information on continuous dynamic developmental processes. Here, we performed single cell RNA sequencing of in vitro -differentiated mouse ES cells to capture the continuous developmental process leading to hemangiogenesis. We found that hemangiogenic progenitors from ES cells develop through intermediate gastrulation stages, which are gradually specified by ‘relay’-like highly overlapping transcription factor modules. Moreover, the transcriptional program of the Flk1 + mesoderm was maintained in the smooth muscle lineage, suggesting that smooth muscle is the default fate of Flk1 + mesoderm. We also identified the SRC kinase contributing to ETV2-mediated activation of the hemangiogenic program. This continuous transcriptome map will facilitate both basic and applied studies of mesoderm development.