Recent work on the sea urchin endomesoderm gene regulatory network (GRN) offers many opportunities to study the specification and differentiation of each cell type during early development at a mechanistic level. The mesoderm lineages consist of two cell populations, primary and secondary mesenchyme cells (PMCs and SMCs). The micromere-PMC GRN governs the development of the larval skeleton, which is the exclusive fate of PMCs, and SMCs diverge into four lineages, each with its own GRN state. Here we identify a sea urchin ortholog of the Twist transcription factor, and show that it plays an essential role in the PMC GRN and later is involved in SMC formation. Perturbations of Twist either by morpholino knockdown or by overexpression result in defects in progressive phases of PMC development, including specification, ingression/EMT, differentiation and skeletogenesis. Evidence is presented that Twist expression is required for the maintenance of the PMC specification state, and a reciprocal regulation between Alx1 and Twist offers stability for the subsequent processes, such as PMC differentiation and skeletogenesis. These data illustrate the significance of regulatory state maintenance and continuous progression during cell specification, and the dynamics of the sequential events that depend on those earlier regulatory states.