During maturation, chondrocytes undergo changes in morphology, matrix production, and gene expression; however, it remains unclear whether these are interrelated. In this study, we examined whether Rho GTPases were involved in these regulatory interplays. Levels of active Rho GTPases were assayed in immature and mature primary chondrocytes. We found that activation of Rac-1 and Cdc42 increased with maturation, whereas RhoA levels remained unchanged. GFP-tagged Rho GTPases tracked cellular localization. Rac-1 was enriched at the cell membrane where it co-localized with cortical actin, while RhoA and Cdc42 were cytoplasmic. To test the roles of Rac-1 in chondrocyte maturation, we force-expressed constitutively active or dominant negative forms of Rac-1 and assessed phenotypic consequences in primary chondrocytes. Activated Rac-1 expression induced chondrocyte enlargement and increased matrix metalloproteinase expression, which are characteristic of mature chondrocytes. Conversely, Rac-1 inactivation diminished adhesion, decreased alkaline phosphatase activity, and stimulated functions typical of immature chondrocytes. Exposure to a pro-maturation factor, Wnt3A, induced a flattened and enlarged morphology accompanied by peripheral Rac-1 rearrangement. Wnt3A stimulated Tiam1 expression and Rac-1 activation, while DN-Rac-1 inhibited Wnt3A-induced cell spreading. Our data provide strong evidence that Rac-1 coordinates changes in chondrocyte phenotype and function and stimulates the maturation process essential for skeletal development.