MicroRNAs (miRNAs) are known to regulate critical developmental stages during embryogenesis. Here, we defined an Etv2-miR-130a cascade that regulates mesodermal specification and determination. Ablation of Dicer in the Etv2-expressing precursors resulted in altered mesodermal lineages and embryonic lethality. We identified miR-130a as a direct target of Etv2 and demonstrated its role in the segregation of bipotent hemato-endothelial progenitors toward the endothelial lineage. Gain-of-function experiments demonstrated that miR-130a promoted the endothelial program at the expense of the cardiac program without impacting the hematopoietic lineages. In contrast, CRISPR/Cas9-mediated knockout of miR-130a demonstrated a reduction of the endothelial program without affecting hematopoiesis. Mechanistically, miR-130a directly suppressed Pdgfra expression and promoted the endothelial program by blocking Pdgfra signaling. Inhibition or activation of Pdgfra signaling phenocopied the miR-130a overexpression and knockout phenotypes, respectively. In summary, we report the function of a miRNA that specifically promotes the divergence of the hemato-endothelial progenitor to the endothelial lineage.