Sipuncula is a lophotrochozoan taxon with annelid affinities, albeit lacking segmentation of the adult body. Here, we present data on cell proliferation and myogenesis during development of three sipunculan species, Phascolosoma agassizii, Thysanocardia nigra, and Themiste pyroides. The first anlagen of the circular body wall muscles appear simultaneously and not subsequently as in the annelids. At the same time, the rudiments of four longitudinal retractor muscles appear. This supports the notion that four introvert retractors were part of the ancestral sipunculan bodyplan. The longitudinal muscle fibers form a pattern of densely arranged fibers around the retractor muscles, indicating that the latter evolved from modified longitudinal body wall muscles. For a short time interval, the distribution of S-phase mitotic cells shows a metameric pattern in the developing ventral nerve cord during the pelagosphera stage. This pattern disappears close to metamorphic competence. Our findings are congruent with data on sipunculan neurogenesis, as well as with recent molecular analyses that place Sipuncula within Annelida, and thus strongly support a segmental ancestry of Sipuncula.