Recapitulating three-dimensional (3D) structures of complex organs, such as the kidney, from pluripotent stem cells (PSCs) is a major challenge. Here, we define the developmental origins of the metanephric mesenchyme (MM), which generates most kidney components. Unexpectedly, we find that posteriorly located T(+) MM precursors are developmentally distinct from Osr1(+) ureteric bud progenitors during the postgastrulation stage, and we identify phasic Wnt stimulation and stage-specific growth factor addition as molecular cues that promote their development into the MM. We then use this information to derive MM from PSCs. These progenitors reconstitute the 3D structures of the kidney in vitro, including glomeruli with podocytes and renal tubules with proximal and distal regions and clear lumina. Furthermore, the glomeruli are efficiently vascularized upon transplantation. Thus, by reevaluating the developmental origins of metanephric progenitors, we have provided key insights into kidney specification in vivo and taken important steps toward kidney organogenesis in vitro. Copyright © 2014 Elsevier Inc. All rights reserved.