The epicardium is the last layer of the vertebrate heart to form, surrounding the heart muscle during embryogenesis and providing signaling cues essential to the continued growth and differentiation of the heart. This outer layer of the heart develops from a transient structure, the proepicardial organ (PEO). Despite its essential roles, the early signals required for the formation of the PEO and the epicardium remain poorly understood. The molecular markers wt1 and tcf21 are used to identify the epicardial layer in the zebrafish heart, to trace its development and to determine genes required for its normal development. Disruption of lateral plate mesoderm (LPM) migration through knockdown of miles apart or casanova leads to cardia bifida with each bilateral heart associated with its own PEO, suggesting that the earliest progenitors of the epicardium lie in the LPM. Using a gene knockdown approach, a genetic framework for PEO development is outlined. The pandora/spt6 gene is required for multiple cardiac lineages, the zinc-finger transcription factor wt1 is required for the epicardial lineage only and finally, the cell polarity genes heart and soul and nagie oko are required for proper PEO morphogenesis.