Tendon-bone attachment sites, called entheses, are essential for musculoskeletal function. They are formed embryonically by Sox9+ progenitors and continue to develop postnatally, utilizing Gli1 lineage cells. Despite their importance, we lack information on the transition from embryonic to mature enthesis and on the relation between Sox9+ progenitors and the Gli1 lineage. Here, by performing a series of lineage tracing experiments in mice, we identify the onset of Gli1 lineage contribution to different entheses. We show that Gli1 expression is regulated embryonically by SHH signaling, whereas postnatally it is maintained by IHH signaling. During bone elongation, some entheses migrate along the bone shaft, whereas others remain stationary. Interestingly, in stationary entheses Sox9⁺ cells differentiate into the Gli1 lineage, but in migrating entheses this lineage is replaced by Gli1 lineage. These Gli1⁺ progenitors are defined embryonically to occupy the different domains of the mature enthesis. Overall, these findings demonstrate a developmental strategy whereby one progenitor population establishes a simple embryonic tissue, whereas another population contributes to its maturation. Moreover, they suggest that different cell populations may be considered for cell-based therapy of enthesis injuries.