Vasculogenesis describes the process of de novo vessel formation from vascular precursor cells. Although formation of the first major vessels, such as the dorsal aorta and cardinal veins, occurs during embryonic vasculogenesis, the contribution of precursor cell populations to postnatal vessel development is not well understood. Here, we identified a novel population of postnatal vascular precursor cells in mice. These cells express the Schwann cell protein myelin protein zero (Po) and exhibit a CD45⁻CD31⁻VEcad⁻c-kit⁺CXCR4⁺ surface phenotype. Po⁺ vascular precursors (PVPs) are recruited into the growing vasculature, and comprise a minor population of arterial endothelial cells in adult mice. Recruitment of PVPs into growing vessels is mediated by CXCL12–CXCR4 signaling, and is enhanced during vascular expansion induced by Notch inhibition. Po-specific ablation of Flk1, a receptor for VEGF, results in branching defects and insufficient arterial patterning in the retina, as well as reduced neovascularization of tumors and ischemic tissues. Thus, in postnatal mice, although growing vessels are formed primarily by angiogenesis from preexisting vessels, a minor population of arterial endothelia may be derived from tissue-resident vascular precursor cells.