The present invention is of a simplified and inexpensive method for the in-vitro identification, isolation and culture of human vasculogenic progenitor cells. The technology allows for the isolation and enrichment of a common precursor for endothelia, smooth muscle and hematopoietic cells derived from human embryonic stem cells. This precursor has been found to express early endothelial and hematopoietic markers and under specific conditions, it persists in endothelial differentiation, forms vessel like structures with blood cells, and differentiates into smooth muscle cells (SMC). The method and the progenitor cells described may be used for in-vitro vascular engineering, among other things.