Regardless of their sex chromosome karyotype, amniotes develop two pairs of genital ducts, the Wolffian and Müllerian ducts. As the Müllerian duct forms, its growing tip is intimately associated with the Wolffian duct as it elongates to the urogenital sinus. Previous studies have shown that the presence of the Wolffian duct is required for the development and maintenance of the Müllerian duct. The Müllerian duct is known to form by invagination of the coelomic epithelium, but the mechanism for its elongation to the urogenital sinus remains to be defined. Using genetic fate mapping, we demonstrate that the Wolffian duct does not contribute cells to the Müllerian duct. Experimental embryological manipulations and molecular studies show that precursor cells at the caudal tip of the Müllerian duct proliferate to deposit a cord of cells along the length of the urogenital ridge. Furthermore, immunohistochemical analysis reveals that the cells of the developing Müllerian duct are mesoepithelial when deposited, and subsequently differentiate into an epithelial tube and eventually the female reproductive tract. Our studies define cellular and molecular mechanisms for Müllerian duct formation.