Biological tissues at articulating surfaces, such as articular cartilage, typically have remarkable low-friction properties that limit tissue shear during movement. However, these frictional properties change with trauma, aging, and disease, resulting in an altered mechanical state within the tissues. Yet, it remains unclear how these surface changes affect the behaviour of embedded cells when the tissue is mechanically loaded. Here, we developed a cytocompatible, bilayered hydrogel system that permits control of surface frictional properties without affecting other bulk physicochemical characteristics such as compressive modulus, mass swelling ratio, and water content. This hydrogel system was applied to investigate the effect of variations in surface friction on the biological response of human articular chondrocytes to shear loading. Shear strain in these hydrogels during dynamic shear loading was significantly higher in high-friction hydrogels than in low-friction hydrogels. Chondrogenesis was promoted following dynamic shear stimulation in chondrocyte-encapsulated low-friction hydrogel constructs, whereas matrix synthesis was impaired in high-friction constructs, which instead exhibited increased catabolism. Our findings demonstrate that the surface friction of tissue-engineered cartilage may act as a potent regulator of cellular homeostasis by governing the magnitude of shear deformation during mechanical loading, suggesting a similar relationship may also exist for native articular cartilage.