Mesodermal progenitors arise in the Drosophila embryo from discrete clusters of lethal of scute (l'sc)-expressing cells. Using both genetic loss-of-function and targeted ectopic expression approaches, we demonstrate here that individual progenitors are specified by the sequential deployment of unique combinations of intercellular signals. Initially, the intersection between the Wingless (Wg) and Decapentaplegic (Dpp) expression domains demarcate an ectodermal prepattern that is imprinted on the adjacent mesoderm in the form of a L'sc precluster. All mesodermal cells within this precluster are competent to respond to a subsequent instructive signal mediated by two receptor tyrosine kinases (RTKs), the Drosophila epidermal growth factor receptor (DER) and the Heartless (Htl) fibroblast growth factor receptor. By monitoring the expression of the diphosphorylated form of mitogen-associated protein kinase (MAPK), we found that these RTKs are activated in small clusters of cells within the original competence domain. Each cluster represents an equivalence group because all members initially resemble progenitors in their expression of both L'sc and mesodermal identity genes. Thus, localized RTK activity induces the formation of mesodermal equivalence groups. The RTKs remain active in the single progenitor that emerges from each cluster under the subsequent inhibitory influence of the neurogenic genes. Moreover, DER and Htl are differentially involved in the specification of particular progenitors. We conclude that distinct cellular identity codes are generated by the combinatorial activities of Wg, Dpp, EGF, and FGF signals in the progressive determination of embryonic mesodermal cells.