Failure of septation of the interventricular septum (IVS) is the most common congenital heart defect (CHD), but mechanisms for patterning the IVS are largely unknown. We show that a Tbx5+/Mef2cAHF+ progenitor lineage forms a compartment boundary bisecting the IVS. This coordinated population originates at a first- and second heart field interface, subsequently forming a morphogenetic nexus. Ablation of Tbx5+/Mef2cAHF+ progenitors cause IVS disorganization, right ventricular hypoplasia and mixing of IVS lineages. Reduced dosage of the CHD transcription factor TBX5 disrupts boundary position and integrity, resulting in ventricular septation defects (VSDs) and patterning defects, including Slit2 and Ntn1 misexpression. Reducing NTN1 dosage partly rescues cardiac defects in Tbx5 mutant embryos. Loss of Slit2 or Ntn1 causes VSDs and perturbed septal lineage distributions. Thus, we identify essential cues that direct progenitors to pattern a compartment boundary for proper cardiac septation, revealing new mechanisms for cardiac birth defects.