In vivo niche is known to play important roles in terminal differentiation of implanted bone marrow stromal cells (BMSCs). This study explored the feasibility of repairing articular osteochondral defects using autologous BMSCs and biodegradable polymers. BMSCs from 18 hybrid pigs' marrows were either treated with dexamethasone (40 ng/mL) alone or chondrogenically induced with dexamethasone and transforming growth factor-beta1 (10 ng/mL). The cells were seeded respectively onto polylactic acid (PLA)- coated polyglycolic acid (PGA) scaffolds. Four osteochondral defects in each animal were created at non-weightbearing areas of knee joints (2/each side) and were respectively repaired by a chondrogenically induced BMSC-PGA/PLA construct in experimental group (Exp), by a dexamethasone-treated BMSC-PGA/PLA construct in control 1 group (Ctrl 1), by a PGA/PLA construct alone in control 2 group (Ctrl 2), or left unrepaired in control 3 group (Ctrl 3). To trace the implanted cells, green fluorescent protein (GFP)- labeled BMSCs were implanted in 2 animals. Gross view and histology showed that Exp and Ctrl 1 (with cell implantation) achieved better reparative results than Ctrl 2 and Ctrl 3 (without cell implantation) in terms of the reparative level and the restoration of the histological structure. In addition, 6-month results were better than 3-month results in all 4 groups. In Exp, 11 of 16 defects were completely repaired by hyaline cartilage and cancellous bone. In Ctrl 1, 11 of 16 defects were repaired by fibrocartilage and cancellous bone, although the repair with hyaline cartilage and cancellous bone was observed in 5 of 16 defects. In contrast, no obvious repair or only fibrotic tissue was observed in Ctrl 2 and Ctrl 3. The compressive moduli of repaired cartilage in Exp reached 80.27% of the normal amount at 6 months, with a high level of glycosaminoglycan (GAG) content (no statistical difference from normal). In Ctrl 1, the compressive moduli and GAG content were 62.69% and 78.03% of normal levels, respectively. More importantly, GFP-labeled cells were detected in the engineered cartilage and the repaired subchondral bone. These results strongly indicate that the implanted BMSCs can differentiate into either chondrocytes or osteoblasts and repair articular osteochondral defects by forming engineered cartilage and engineered bone.