Mesenchymal stem cells (MSCs) have shown chondroprotective effects in cartilage repair. However, side effects caused by MSC treatment limit their application in clinic. As a cell-free therapy, MSC-derived exosomes (EXOs) have attracted much more attention in recent years. In the present study, we prepared EXOs from human bone marrow mesenchymal stem cells (hBMSCs) and examined their therapeutic potentials in cartilage repair. Our results showed that the prepared extracellular vesicles exhibit classical features of EXOs, such as cup-like shape, around 100 nm diameter, positive protein markers (CD81, TSG101, and Flotillin 1), and ability of internalization. In primary chondrocytes, the treatment of hBMSC-EXOs markedly increases cell viability and proliferation in a dose-dependent manner. Moreover, wound healing assay showed that hBMSC-EXOs accelerate cell migration in primary chondrocytes. JC-1 staining revealed that the mitochondrial membrane potential was enhanced by hBMSC-EXOs, indicating cell apoptosis was decreased in the presence of hBMSC-EXOs. In rabbits with articular cartilage defects, local administration with hBMSC-EXOs facilitates cartilage regeneration as evidenced by gross view and hematoxylin-eosin (H&E) and Saf-O/Fast Green staining. In addition, the International Cartilage Repair Society (ICRS) score was increased by the application of hBMSC-EXOs. Overall, our data indicate that the treatment with hBMSC-EXOs is a suitable cell-free therapy for treating cartilage defects, and these benefits are likely due to improved cell proliferation and migration in chondrocytes.