The present invention provides cells transformed with a nucleotide sequence encoding Pax7, Pax3 or both. The present invention also pertains to Pax-encoding vector that comprises a sequence encoding Pax7, Pax3 or an active variant or fragment thereof, which can be used to induce myogenic differentiation of stem cells. The present invention further pertains to methods of preparing the Pax-encoding vector. Also provided is a method of inducing myogenic differentiation in stem cells and treating a subject with the cells.