Mesoangioblasts are stem/progenitor cells derived from a subset of pericytes found in muscle that express alkaline phosphatase. They have been shown to ameliorate the disease phenotypes of different animal models of muscular dystrophy and are now undergoing clinical testing in children affected by Duchenne's muscular dystrophy. Here, we show that patients with a related disease, limb-girdle muscular dystrophy 2D (LGMD2D), which is caused by mutations in the gene encoding α-sarcoglycan, have reduced numbers of this pericyte subset and thus produce too few mesoangioblasts for use in autologous cell therapy. Hence, we reprogrammed fibroblasts and myoblasts from LGMD2D patients to generate human induced pluripotent stem cells (iPSCs) and developed a protocol for the derivation of mesoangioblast-like cells from these iPSCs. The iPSC-derived mesoangioblasts were expanded and genetically corrected in vitro with a lentiviral vector carrying the gene encoding human α-sarcoglycan and a promoter that would ensure expression only in striated muscle. When these genetically corrected human iPSC-derived mesoangioblasts were transplanted into α-sarcoglycan-null immunodeficient mice, they generated muscle fibers that expressed α-sarcoglycan. Finally, transplantation of mouse iPSC-derived mesoangioblasts into α-sarcoglycan-null immunodeficient mice resulted in functional amelioration of the dystrophic phenotype and restoration of the depleted progenitors. These findings suggest that transplantation of genetically corrected mesoangioblast-like cells generated from iPSCs from LGMD2D patients may be useful for treating this type of muscular dystrophy and perhaps other forms of muscular dystrophy as well.