Chondral defects, generated as a result of trauma and injury or degenerative joint diseases, such as osteoarthritis, represent some of the most challenging orthopedic conditions in terms of natural tissue healing and repair. Damages to the articular cartilage fail to elicit significant reparative activity, due to the acellularity of the tissue. Clonal proliferation of articular chondrocytes is often seen, and results in the production of mechanically inferior fibrocartilage. Extensive degeneration of the articular surface eventually necessitates total joint arthroplasty. There is, therefore, a timely need for the development of biological approaches to cartilage repair. The emerging research discipline of tissue engineering aims to develop functional tissue substitutes by combining experimental approaches in biology and engineering, and represents a particularly attractive technology for the treatment of skeletal diseases, most of which involve tissue degeneration or failure to heal. Functionally, it is instructional to approach cartilage regeneration in the context of developmental chondrogenesis; that is, the formation of cartilage from a progenitor mesenchymal cell population during embryonic development. In particular, adult tissue-derived mesenchymal stem cells (MSCs), which display multilineage differentiation potential, are currently considered a highly promising source of progenitor cells for tissue engineering. Chondrogenesis in the developing vertebrate limb consists of a highly coordinated and orchestrated series of events involving the commitment and differentiation of mesenchymal cells to mature chondrocytes. This process is regulated by the sequential and coordinated expression of genes that encode for specific cell adhesion molecules, growth factors, and extracellular matrix molecules that carry out morphogenetic and signaling activities. Recently, members of the Wnt family of signaling molecules have been functionally implicated in limb development. The Wnts comprise a large family of cysteine-rich glycoproteins that perform a number of inductive and regulatory functions in both normal development and oncogenic transformations. The expression of various Wnts has been identified in the developing limb, and our recent studies showed that Wnts play an important role in mesenchymal chondrogenesis. Interestingly, our recent work with human MSCs indicates the functional involvement of Wnts and the cell adhesion molecular, N-cadherin, as well as members of the transforming growth factor beta superfamily in MSC chondrogenesis, suggesting that regenerative chondrogenesis and developmental chondrogenesis are likely to share common regulatory pathways. By combining MSCs, biodegradable polymeric scaffolds, and the application of growth and differentiation factors, we are currently developing cartilage constructs in vitro that are potentially applicable for cartilage repair in vivo. Specifically, we recently fabricated a nanofibrous scaffold using a synthetic biodegradable polymer, poly(ε-caprolactone), and demonstrated its ability to support in vitro chondrogenesis of MSCs. The electrospun porous scaffold consisted of uniform, randomly oriented nanofibers (700 nm diameter); MSCs seeded into the scaffold and cultured in the presence of transforming growth factor beta 1 differentiated to chondrocytes, indicated by gene expression and histological profiles, at a level similar to that observed in high-density pellet cultures. The physical nature and improved mechanical properties of such scaffolds, particularly in comparison with cell pellets, suggest that these constructs may serve as a practical carrier for MSC transplantation in cell-based tissue engineering approaches to cartilage repair, supported by our preliminary animal model study. The future success of cartilage tissue engineering is dependent on a number of requirements, including expansion of progenitor cells, optimization of biomaterial scaffold design, and molecular enhancement of cell differentiation and growth using biologics and gene therapeutic means. We believe that the understanding of developmental chondrogenesis serves as a rational and powerful paradigm for cartilage tissue engineering.