Osteoarthritis (OA) is characterized by the loss of articular cartilage and is also an age-related disease. Recently, stem cell therapy for cartilage repair has emerged. The stem cells need to be cultured with a fetal bovine serum (FBS)-supplemented medium. The effect of FBS-containing exosomes on the differentiation of human umbilical cord mesenchymal stem cells (HUCMSCs) is unknown. The morphology, proliferation, surface marker expressions, and trilineage differentiation ability of two groups of HUCMSCs, cultured with conventional (FBS) and exosome-depleted FBS (Exo(-)FBS), were evaluated. In a mouse OA model after two groups of HUCMSCs transplantation, the rotarod activity, histology, and immunohistochemistry (type II collagen, aggrecan, IL-1β, and MMP13) of the cartilage were evaluated. The Exo(-)FBS-cultured HUCMSCs, like FBS-cultured HUCMSCs, displayed classic MSC characteristics, including spindle-shaped morphology, surface marker expression (positive for CD44, CD73, CD90, CD105, and HLA-ABC and negative for CD34, CD45, and HLA-DR), and trilineage differentiation (chondrogenesis, osteogenesis, and adipogenesis). The Exo(-)FBS-cultured HUCMSCs proliferated significantly slower than those of the FBS-cultured HUCMSCs (p < 0.01). The trilineage gene expression of PPAR-γ, FABP4, APAL, type II collagen, aggrecan, and SOX9 was significantly increased in the Exo(-)FBS-cultured HUCMSCs than in the FBS-cultured HUCMSCs and undifferentiated controls. The Exo(-)FBS- and FBS-cultured HUCMSCs-transplanted mice showed a better rotarod activity than in the control OA mice (n = 3 in each group). A significant histological improvement in hyaline cartilage destruction after the transplantation of both types of FBS-cultured HUCMSCs was noted when compared with the OA knees. The Exo(-)FBS-cultured HUCMSCs-transplanted knees showed a higher International Cartilage Repair Society histological score (p < 0.05), staining intensity of type II collagen (p < 0.01), and aggrecan (p < 0.01) than in the control knees. Moreover, both types of the FBS-cultured HUCMSCs-transplanted knees significantly decreased the expression of MMP13 and IL-1β compared to that in the OA knees (p < 0.01). The Exo(-)FBS-cultured HUCMSCs harbor chondrogenic potential and attenuated cartilage destruction in a mouse OA model. Our study provides a basis for future clinical trials using Exo(-)FBS-cultured stem cells to treat OA.