Interstitial cells of Cajal (ICCs) form a network of cells between the external longitudinal and circular muscle layers at the level of the Auerbach's plexus in the mammalian small intestine. These cells express the Kit receptor tyrosine kinase and are essential for intestinal pacemaker activity. W mutant mice carrying structural mutations in the Kit gene lack both the network of ICCs and intestinal pacemaker activity. We were interested in the developmental origin of the cells that make up the network of ICCs. In addition, the specific stages of ICC development that require a functional Kit receptor have not been characterized. We show that ICCs originate from mesenchymal progenitor cells that coexpress both Kit and smooth muscle myosin heavy chain, a marker specific for smooth muscle, during embryogenesis. ICC and longitudinal smooth muscle lineages begin to diverge late in gestation. Embryos homozygous for the regulatory Wbanded (Wbd) mutation do not express Kit in these mesenchymal progenitor cells. Nevertheless, Wbd/Wbd mice display a normal network of ICCs and normal smooth muscle layers at postnatal day 5 (p5). Adult Wbd/Wbd mice lack a functional ICC network and intestinal pacemaker activity due to a failure of the ICCs to increase in numbers after p5. These data suggest a common developmental origin of the ICCs and the longitudinal smooth muscle layers in the mammalian small intestine and show that Kit expression is necessary for the postnatal development and proliferation of ICCs but not for the initial cell lineage decision toward an ICC fate during embryogenesis or for smooth muscle development.