Here, we identify a role for the matrilin-2 (Matn2) extracellular matrix protein in controlling the early stages of myogenic differentiation. We observed Matn2 deposition around proliferating, differentiating and fusing myoblasts in culture and during muscle regeneration in vivo. Silencing of Matn2 delayed the expression of the Cdk inhibitor p21 and of the myogenic genes Nfix, MyoD and Myog, explaining the retarded cell cycle exit and myoblast differentiation. Rescue of Matn2 expression restored differentiation and the expression of p21 and of the myogenic genes. TGF-β1 inhibited myogenic differentiation at least in part by repressing Matn2 expression, which inhibited the onset of a positive-feedback loop whereby Matn2 and Nfix activate the expression of one another and activate myoblast differentiation. In vivo, myoblast cell cycle arrest and muscle regeneration was delayed in Matn2(-/-) relative to wild-type mice. The expression levels of Trf3 and myogenic genes were robustly reduced in Matn2(-/-) fetal limbs and in differentiating primary myoblast cultures, establishing Matn2 as a key modulator of the regulatory cascade that initiates terminal myogenic differentiation. Our data thus identify Matn2 as a crucial component of a genetic switch that modulates the onset of tissue repair.