Understanding the molecular mechanisms of epicardial epithelial-to-mesenchymal transition (EMT), particularly in directing cell fate toward epicardial derivatives, is crucial for regenerative medicine using human induced pluripotent stem cell (iPSC)-derived epicardium. Although transforming growth factor β (TGF-β) plays a pivotal role in epicardial biology, orchestrating EMT during embryonic development via downstream signaling through SMAD proteins, the function of SMAD proteins in the epicardium in maintaining vascular homeostasis or mediating the differentiation of various epicardial-derived cells (EPDCs) is not yet well understood. Our study reveals that TGF-β-independent SMAD3 expression autonomously predicts epicardial cell specification and lineage maintenance, acting as a key mediator in promoting the angiogenic-oriented specification of the epicardium into cardiac pericyte progenitors. This finding uncovers a novel role for SMAD3 in the human epicardium, particularly in generating cardiac pericyte progenitors that enhance cardiac microvasculature angiogenesis. This insight opens new avenues for leveraging epicardial biology in developing more effective cardiac regeneration strategies.