Distinguishing between implanted and host-derived cells, as well as cells of different phenotypes, is important in determining mechanisms of cell-based repair of cartilage. The objectives of this study were to assess the utility of carboxyfluorescein diacetate, succinimidyl ester (''CFDA, SE'' or CFSE) for tracking chondrocytes from superficial (S) and middle (M) zones and their proliferation, and to determine the effects of CFSE on the chondrocyte functions, proliferation, and synthesis of proteoglycan 4 (PRG4) and glycosaminoglycan (GAG). CFSE-labeled and unlabeled S and M zone chondrocytes were plated in either low-or high-density (10,000 or 200,000 cells=cm 2 ) monolayer, incubated, and analyzed on days 1 and 7. Cell suspensions were analyzed for retention of CFSE by flow cytometry and fluorescence microscopy and for cell proliferation by assay for DNA and GAG. Cultures were also analyzed for newly synthesized PRG4. Deconvolution of flow cytometric histograms was done to determine the number of cells in each doubling generation. Most chondrocytes were labeled consistently and intensely labeled with CFSE through 10 cycles of division. At day 7 of culture, approximately 95% of S and M zone cells seeded at high density could be distinguished as fluorescent. Chondrocyte proliferation and synthesis of PRG4 were unaffected by cell labeling, while GAG synthesis was slightly diminished. CFSE may be useful in determining the fate and function of implanted chondrocytes in vivo.