Osteoarthritis (OA) is the most prevalent joint disorder, causing pain and disability predominantly in the aging population but also affecting young individuals. Current treatments are limited to use of anti-inflammatory drugs to alleviate symptoms or degenerated joint replacement by a prosthetic implant at the end stage of the disease. We hypothesized that degenerative cartilage defects can be treated using nasal chondrocyte–based tissue-engineered cartilage (N-TEC). We demonstrate that N-TEC maintained cartilaginous properties when exposed in vitro to inflammatory stimuli found in osteoarthritic joints and favorably altered the inflammatory profile of cells from osteoarthritic joints. These effects were at least partially mediated by down-regulation of the WNT (wingless/integrated) signaling pathway through sFRP1 (secreted frizzled-related protein-1). We further report that N-TEC survive and engraft in vivo in ectopic mouse models reproducing a human osteochondral OA tissue environment, as well as in sheep articular cartilage defects that mimic degenerative settings. Last, we tested the safety of autologous N-TEC for the treatment of osteoarthritic cartilage defects in the knees of two patients with advanced OA (Kellgren and Lawrence grades 3 and 4) who were otherwise considered for unicondylar knee arthroplasty. No adverse reactions were recorded, and patients reported reduced pain as well as improved joint function and life quality 14 months after surgery. Together, our findings indicate that N-TEC can directly contribute to cartilage repair in osteoarthritic joints. A suitably powered clinical trial is now required to assess its efficacy in the treatment of patients with OA.