Background: Mesenchymal stem cells (MSCs) have the potential to differentiate into distinct mesenchymal tissues; including cartilage and bone, they can be an attractive cell source for cartilage tissue engineering approaches. Our objective here was to compare the in vitro chondrogenic potential of MSCs isolated from patients with rheumatoid arthritis (RA) and osteoarthritis (OA) with cells from normal donors. Methods: Marrow samples were removed during bone surgery and adherent cell cultures were established. The cells were then passed into a newly developed microaggregate culture system in a medium containing transforming growth factor β3, insulin, dexamethasone and/or demineralized bone matrix. In vitro chondrogenic activity was measured as metabolic sulfate incorporation and type II collagen expression in pellet cultures. Results: Culture-expanded MSCs from RA and OA patients did not differ significantly from the normal population with respect to their chondrogenic potential in vitro. Capability of total protein and proteoglycan synthesis as well as collagen II mRNA expression by cell aggregates was similar for all cell preparations in the presence of the appropriate growth and differentiation factors. Chondroprotective drugs such as chondroitin sulfate and glucosamine enhanced, whereas chloroquine inhibited chondrogenesis in normal donor-derived or patient-derived MSC cultures. Galectin-1, a β-galactoside-binding protein with marked anti-inflammatory activity, stimulated the chondrogenic differentiation of mesenchymal cells in low (<2 μg/ml) concentration. Discussion: These findings show that MSCs from RA and OA patients possess similar chondrogenic potential as MSCs isolated from healthy donors, therefore these cells may serve as a potential new prospect in cartilage replacement therapy.