In vitro culture systems which structurally recapitulate human myogenesis and promote PAX7+ myogenic progenitor maturation have not been established. Here we report human skeletal muscle organoids differentiated from induced pluripotent stem cell lines that contain paraxial mesoderm and neuromesodermal progenitors and develop into organized structures, reassembling neural plate border and dermomyotome formation. Culture conditions causes neural lineage arrest and promotes fetal hypaxial myogenesis towards limb axial anatomical identity and generates sustainable uncommitted PAX7 myogenic progenitors, as well as fibroadipogenic (PDGFRa+) progenitor populations equivalent to those from second trimester of human gestation. Single cell comparison to human fetal and adult myogenic progenitors, reveals distinct molecular signatures for myogenic progenitors in activated (CD44+, CD98+, MYOD1+, MYF5+) and in dormant (PAX7+, FBN1+, SPRY1+, CHODL1+) states, as well as indicated developmental trajectories associated to myogenic commitment and differentiation or self-renewal. Our approach, further validated with Duchenne and CRISPR/Cas9 genome-edited Limb-girdle muscular dystrophy (LGMD2A) patient iPSC lines, provides a robust in vitro developmental system for investigating muscle tissue morphogenesis and homeostasis.