Tissue engineering and regenerative medicine (TERM) have paved a way for treating musculoskeletal diseases in a minimally invasive manner. The regenerative medicine cocktail involves the usage of mesenchymal stem/stromal cells (MSCs), either uncultured or culture-expanded cells along with growth factors, cytokines, exosomes, and secretomes to provide a better regenerative milieu in degenerative diseases. The successful regeneration of cartilage depends on the selection of the appropriate source of MSCs, the quality, quantity, and frequency of MSCs to be injected, and the selection of the patient at an appropriate stage of the disease. However, confirmation on the most favorable source of MSCs remains uncertain to clinicians. The lack of knowledge in the current cellular treatment is uncertain in terms of how beneficial MSCs are in the long-term or short-term (resolution of pain) and improved quality of life. Whether MSCs treatments have any superiority, exists due to sources of MSCs utilized in their potential to objectively regenerate the cartilage at the target area. Many questions on source and condition remain unanswered. Hence, in this review, we discuss the lineage differentiation potentials of various sources of MSCs used in the management of knee osteoarthritis and emphasize the role of tissue engineering in cartilage regeneration.