Human embryonic stem cells (hESCs) are a potential source of material for cell therapy of muscle diseases. To date, it has proven difficult to generate skeletal muscle from hESCs in high yields and within a reasonable timeframe. Further, a hESC-derived Pax3/7-positive skeletal muscle progenitor population has not yet been described. Previous studies have shown that Pax3/7-positive progenitor cells can repopulate the satellite cell niche, indicating the importance of this population for therapy. We sought to optimize the differentiation of hESCs into skeletal muscle in order to characterize myogenesis at a molecular level and shorten the time course. We treated hESCs with retinoic acid (RA) and found an enhancement of skeletal myogenesis, and the expression of the myogenic regulatory factors (MRFs) MyoD and myogenin by day 25. Furthermore, we found that RA treatment expanded the muscle progenitor pool, which occurred as a distinct Pax3(+ve) population prior to MRF expression. Non-skeletal muscle tissue types were not significantly affected. Therefore, we have identified a differentiation pathway in hESCs that provides a skeletal muscle progenitor population which can undergo myogenesis more efficiently. We propose that RA could fit into a directed culture method for deriving skeletal muscle from hESCs.