The development of the segmented pharyngeal apparatus involves complex interaction of tissues derived from all three germ layers. The role of mesoderm is the least studied, perhaps because of its apparent lack of anatomical boundaries and positionally restricted gene expression. Here, we report that the mesoderm-specific deletion of Tbx1, a T-box transcription factor, caused severe pharyngeal patterning and cardiovascular defects, while mesoderm-specific restoration of Tbx1 expression in a mutant background corrected most of those defects in the mouse. We show that some organs, e.g. the thymus, require Tbx1 expression in the mesoderm and in the epithelia. In addition, these experiments revealed that different pharyngeal arches require Tbx1 in different tissues. Finally, we show that Tbx1 in the mesoderm is required to sustain cell proliferation. Thus, the mesodermal transcription program is not only crucial for cardiovascular development, but is also key in the development and patterning of pharyngeal endoderm.