Over the past decades, mesenchymal stromal cells (MSCs) have been extensively investigated as a potential therapeutic cell source for the treatment of various disorders. Differentiation of MSCs from human induced pluripotent stem cells (iMSCs) has provided a scalable approach for the biomanufacturing of MSCs and related biological products. Although iMSCs shared typical MSC markers and functions as primary MSCs (pMSCs), there is a lack of lineage specificity in many iMSC differentiation protocols. Here, a stepwise hiPSC‐to‐iMSC differentiation method is employed via intermediate cell stages of neural crest and cytotrophoblast to generate lineage‐specific MSCs with varying differentiation efficiencies and gene expression. Through a comprehensive comparison between early developmental cell types (hiPSCs, neural crest, and cytotrophoblast), two lineage‐specific iMSCs, and six source‐specific pMSCs, are able to not only distinguish the transcriptomic differences between MSCs and early developmental cells, but also determine the transcriptomic similarities of iMSC subtypes to postnatal or perinatal pMSCs. Additionally, it is demonstrated that different iMSC subtypes and priming conditions affected EV production, exosomal protein expression, and cytokine cargo.