Embryogenesis is supported by dynamic loops of cellular interactions. Here, we create a partial mouse embryo model to elucidate the principles of epiblast (Epi) and extra-embryonic endoderm co-development (XEn). We trigger naive mouse embryonic stem cells to form a blastocyst-stage niche of Epi-like cells and XEn-like cells (3D, hydrogel free and serum free). Once established, these two lineages autonomously progress in minimal medium to form an inner pro-amniotic-like cavity surrounded by polarized Epi-like cells covered with visceral endoderm (VE)-like cells. The progression occurs through reciprocal inductions by which the Epi supports the primitive endoderm (PrE) to produce a basal lamina that subsequently regulates Epi polarization and/or cavitation, which, in return, channels the transcriptomic progression to VE. This VE then contributes to Epi bifurcation into anterior- and posterior-like states. Similarly, boosting the formation of PrE-like cells within blastoids supports developmental progression. We argue that self-organization can arise from lineage bifurcation followed by a pendulum of induction that propagates over time.