ABSTRACT: Significance During pregnancy, extravillous trophoblasts (EVTs) detach from anchoring sites of the placenta, differentiate, and invade the maternal uterus to remodel its vasculature. Failures in this program contribute to placentation defects observed in gestational disorders such as spontaneous pregnancy loss, early-onset preeclampsia, and fetal growth restriction. However, critical regulators and signaling pathways controlling EVT development have been poorly elucidated. In the present study, we demonstrate that transforming growth factor-β (TGF-β) signaling plays a pivotal role in the differentiation program of EVTs. In vitro, loss of Wingless signaling was sufficient for EVT formation in self-renewing trophoblast models, whereas subsequent activation of TGF-β signaling accomplished differentiation into trophoblasts that display some features of in vivo EVTs. Abnormal placentation has been noticed in a variety of pregnancy complications such as miscarriage, early-onset preeclampsia, and fetal growth restriction. Defects in the developmental program of extravillous trophoblasts (EVTs), migrating from placental anchoring villi into the maternal decidua and its vessels, is thought to be an underlying cause. Yet, key regulatory mechanisms controlling commitment and differentiation of the invasive trophoblast lineage remain largely elusive. Herein, comparative gene expression analyses of HLA-G–purified EVTs, isolated from donor-matched placenta, decidua, and trophoblast organoids (TB-ORGs), revealed biological processes and signaling pathways governing EVT development. In particular, bioinformatics analyses and manipulations in different versatile trophoblast cell models unraveled transforming growth factor-β (TGF-β) signaling as a crucial pathway driving differentiation of placental EVTs into decidual EVTs, the latter showing enrichment of a secretory gene signature. Removal of Wingless signaling and subsequent activation of the TGF-β pathway were required for the formation of human leukocyte antigen-G+ (HLA-G+) EVTs in TB-ORGs that resemble in situ EVTs at the level of global gene expression. Accordingly, TGF-β–treated EVTs secreted enzymes, such as DAO and PAPPA2, which were predominantly expressed by decidual EVTs. Their genes were controlled by EVT-specific induction and genomic binding of the TGF-β downstream effector SMAD3. In summary, TGF-β signaling plays a key role in human placental development governing the differentiation program of EVTs.