Proliferation and fusion of myoblasts is a well-orchestrated process occurring during muscle development and regeneration. Although myoblasts are known to originate from muscle satellite cells, the molecular mechanisms that coordinate their commitment toward differentiation are poorly understood. Here, we present a novel role for the transcription factor Forkhead box protein C2 (Foxc2) in regulating proliferation and preventing premature differentiation of activated muscle satellite cells. We demonstrate that Foxc2 expression is upregulated early in activated mouse muscle satellite cells and then diminishes during myogenesis. In undifferentiated C2C12 myoblasts, downregulation of endogenous Foxc2 expression leads to a decrease in proliferation, whereas forced expression of FOXC2 sustains proliferation and prevents differentiation into myotubes. We also show that FOXC2 induces Wnt signaling by direct interaction with the Wnt4 (wingless-type MMTV integration site family member-4) promoter region. The resulting elevated expression of bone morphogenetic protein-4 (Bmp4) and RhoA-GTP proteins inhibits the proper myoblast alignment and fusion required for myotube formation. Interestingly, continuous forced expression of FOXC2 alters the commitment of C2C12 myoblasts toward osteogenic differentiation, which is consistent with FOXC2 expression observed in patients with myositis ossificans, an abnormal bone growth within muscle tissue. In summary, our results suggest that (a) Foxc2 regulates the proliferation of multipotent muscle satellite cells; (b) downregulation of Foxc2 is critical for myogenesis to progress; and (c) sustained Foxc2 expression in myoblast cells suppresses myogenesis and alters their lineage commitment toward osteogenesis by inducing the Wnt4 and Bmp4 signaling pathways.