Regulation of matrix metalloproteinases (MMPs) by collagen in the fibroblast-like synoviocytes (FLSs) plays a critical role in joint destruction in rheumatoid arthritis (RA). Our previous study indicated that discoidin receptor 2 (DDR2) mediated collagen upregulation of MMPs. However, the precise underlying mechanism remains unclear. We report here that CYR61, a secreted, extracellular matrix-associated signaling protein which is capable of regulating a broad range of cellular activities, including cell adhesion, migration, proliferation, and apoptosis, is significantly upregulated in collagen II-stimulated RA FLS. Further studies found that collagen II-activated phosphorylated-DDR2 induces CYR61 through activation of transcription factor activator protein 1 (AP-1). The elevated CYR61, in turn, accelerates MMP1 production via ETS1 (ETS proto-oncogene 1). In addition, CYR61 significantly promotes FLS invasion and migration. Blockade of CYR61 by an adenovirus expressing CYR61 shRNA (Ad-shCYR61) in vivo remarkably ameliorated the severity of arthritis, reduced inflammatory cytokine secretion, and attenuated bone erosion as detected by micro-computed tomography (μCT), in collagen-induced arthritis (CIA) rats. Taken together, we uncovered the Collagen II-DDR2-AP-1-CYR61-ETS1-MMP1 loop in RA FLS. In which, CYR61 acts as a hinge to promote cartilage damage through regulating FLS invasion, migration, and MMP1 production and the inflammatory cascade in RA. Thus, CYR61 may be a promising diagnostic and therapeutic target for RA treatment. © 2016 American Society for Bone and Mineral Research.