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The congenital form of myotonic dystrophy type 1 (cDM) is caused by the large-scale expansion of a (CTG•CAG) n repeat in DMPK and DM1-AS . The production of toxic transcripts with long trinucleotide tracts from these genes results in impairment of the myogenic differentiation capacity as cDM's most prominent morpho-phenotypic hallmark. In the current in vitro study, we compared the early differentiation programs of isogenic cDM myoblasts with and without a (CTG)2600 repeat obtained by gene editing. We found that excision of the repeat restored the ability of cDM myoblasts to engage in myogenic fusion, preventing the ensuing myotubes from remaining immature. Although the cDM-typical epigenetic status of the DM1 locus and the expression of genes therein were not altered upon removal of the repeat, analyses at the transcriptome and proteome level revealed that early abnormalities in the temporal expression of differentiation regulators, myogenic progression markers, and alternative splicing patterns before and immediately after the onset of differentiation became normalized. Our observation that molecular and cellular features of cDM are reversible in vitro and can be corrected by repeat-directed genome editing in muscle progenitors, when already committed and poised for myogenic differentiation, is important information for the future development of gene therapy for different forms of myotonic dystrophy type 1 (DM1).