Polyps of the family Cassiopeidae (Cnidaria: Scyphozoa) can reproduce asexually by forming a ciliated swimming stage, the planuloid. It is externally similar to the planula larva and has traditionally been referred to as the planuloid bud. Using phalloidin labeling, we described the development of the muscular system in planuloids of Cassiopeia xamachana during growth and metamorphosis into the polyp. Early growth stages of the planuloid involve septal muscle bands of the polyp but after separation from the mother organism it forms its own musculature de novo. Muscular elements of the newly separated planuloid are represented by short disordered fibers and four main groups of longitudinal muscles. These elements are the primary musculature of the future polyp. During further development the planuloid grows, changes in shape from elongated to triangular and starts to form the musculature of the hypostome and the tentacles anlages. By the time of settlement the muscular groups form four bands. Process of musculature formation in planuloids differs from that in scyphozoan planulae, which lack well-developed muscular elements. The formation of planuloids might be a modification of lateral budding, with the development of the daughter polyp occurring distantly from the mother organism. These stages could not be called true buds because of their independent growth, and so the term “planuloid bud” is misleading. We argue that the planuloid is the best name for this stage since it reflects its biology and at the same time emphasizes its similarity to the planula larva.