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Injuries to articular cartilage are one of the most challenging issues of musculoskeletal medicine due to the poor intrinsic ability of this tissue for repair. Despite progress in orthopaedic surgery, the lack of efficient modalities of treatment for large chondral defects has prompted research on tissue engineering combining chondrogenic cells, scaffold materials and environmental factors. The aim of this review is to focus on the recent advances made in exploiting the potentials of cell therapy for cartilage engineering. These include: 1) defining the best cell candidates between chondrocytes or multipotent progenitor cells, such as multipotent mesenchymal stromal cells (MSC), in terms of readily available sources for isolation, expansion and repair potential; 2) engineering biocompatible and biodegradable natural or artificial matrix scaffolds as cell carriers, chondrogenic factors releasing factories and supports for defect filling, 3) identifying more specific growth factors and the appropriate scheme of application that will promote both chondrogenic differentiation and then maintain the differentiated phenotype overtime and 4) evaluating the optimal combinations that will answer to the functional demand placed upon cartilage tissue replacement in animal models and in clinics. Finally, some of the major obstacles generally encountered in cartilage engineering are discussed as well as future trends to overcome these limiting issues for clinical applications.