The field of tissue engineering entered a new era with the development of human pluripotent stem cells (hPSCs), which are capable of unlimited expansion whilst retaining the potential to differentiate into all mature cell populations. However, these cells harbor significant risks, including tumor formation upon transplantation. One way to mitigate this risk is to develop expandable progenitor cell populations with restricted differentiation potential. Here, we used a cellular microarray technology to identify a defined and optimized culture condition that supports the derivation and propagation of a cell population with mesodermal properties. This cell population, referred to as intermediate mesodermal progenitor (IMP) cells, is capable of unlimited expansion, lacks tumor formation potential, and, upon appropriate stimulation, readily acquires properties of a sub-population of kidney cells. Interestingly, IMP cells fail to differentiate into other mesodermally-derived tissues, including blood and heart, suggesting that these cells are restricted to an intermediate mesodermal fate.