There is a clear clinical need for efficient cartilage healing strategies for treating cartilage defects which burdens millions of patients physically and financially. Different strategies including microfracture technique, osteochondral transfer, and scaffold-based treatments have been suggested for curing cartilage injuries. Although some improvements have been achieved in several facets, current treatments are still less than satisfactory. Recently, different hydrogel-based biomaterials have been suggested as a therapeutic candidate for cartilage tissue regeneration due to their biocompatibility, high water content, and tunability. Specifically, magnetic hydrogels are becoming more attractive due to their smart response to magnetic fields remotely. We seek to outline the context-specific regenerative potential of magnetic hydrogels for cartilage tissue repair. In this review, first, we explained conventional techniques for cartilage repair and then compared them with new scaffold-based approaches. We illustrated various hydrogels used for cartilage regeneration by highlighting the magnetic hydrogels. Also, we gathered in vitro and in vivo studies of how magnetic hydrogels promote chondrogenesis as well as studied the biological mechanism which is responsible for cartilage repair due to the application of magnetic hydrogel.