Articular cartilage covers the ends of bones in synovial joints acting as a shock absorber that helps movement of bones. Damage of the articular cartilage needs treatment as it does not repair itself and the damage can progress to osteoarthritis. In osteoarthritis all the joint tissues are involved with characteristic progressive cartilage degradation and inflammation. Autologous chondrocyte implantation is a well-proven cell-based treatment for cartilage defects, but a main downside it that it requires two surgeries. Multipotent, aka mesenchymal stromal cell (MSC)-based cartilage repair has gained attention as it can be used as a one-step treatment. It is proposed that a combination of immunomodulatory and regenerative capacities make MSC attractive for the treatment of osteoarthritis. Furthermore, since part of the paracrine effects of MSCs are attributed to extracellular vesicles (EVs), small membrane enclosed particles secreted by cells, EVs are currently being widely investigated for their potential therapeutic effects. Although MSCs have entered clinical cartilage treatments and EVs are used in in vivo efficacy studies, not much attention has been given to determine their potency and to the development of potency assays. This chapter provides considerations and suggestions for the development of potency assays for the use of MSCs and MSC-EVs for the treatment of cartilage defects and osteoarthritis.