Differentiation of mesenchymal stem cells (MSCs) derived from two different sources of fetal tissues such as umbilical cord blood (UCB) and tissue (UCT) into skeletal muscle have remained underexplored. Here, we present a comparative analysis of UCB and UCT MSCs, in terms of surface markers, proliferation and senescence marker expression. We find that CD45-CD34- MSCs obtained from UCT and UCB of term births display differences in the combinatorial expression of key MSC markers CD105 and CD90. Importantly, UCT MSCs display greater yield, higher purity, shorter culture time, and lower rates of senescence in culture compared to UCB MSCs. Using a robust myogenic differentiation protocol, we show that UCT MSCs differentiate more robustly into muscle than UCB MSCs by transcriptomic sequencing and specific myogenic markers. Functional assays reveal that CD90, and not CD105 expression promotes myogenic differentiation in MSCs and could explain the enhanced myogenic potential of UCT MSCs. These results suggest that in comparison to large volumes of UCB that are routinely used to obtain MSCs and with limited success, UCT is a more reliable, robust, and convenient source of MSCs to derive cells of the myogenic lineage for both therapeutic purposes and increasing our understanding of developmental processes.