The molecular mechanisms controlling differentiation of mesenchymal precursor cells into chondrocytes (chondrogenesis) are not completely understood. We have recently shown that the small GTPase RhoA inhibits this process. Here we demonstrate that a different Rho GTPase family member, Rac1, promotes chondrogenesis. Pharmacological inhibition of Rac1 expression in micromass culture resulted in reduced mRNA levels of the chondrogenic markers collagen II and aggrecan, and decreased accumulation of glycosaminoglycans. Expression of the essential chondrogenic transcription factors Sox9, Sox5, and Sox6 was also reduced upon inhibition of Rac1 signaling. In contrast, overexpression of Rac1 in the chondrogenic ATDC5 cell line increased mRNA transcripts of Sox9, 5, and 6, collagen II, and aggrecan. Inhibition of Rac1 resulted in a reduction in the number, size, and organization of cellular condensations and decreased expression of N-cadherin. Overexpression of Rac1 resulted in an increase in N-cadherin expression levels. Furthermore, genetic ablation of Rac1 in primary micromass cultures resulted in reduced expression of chondrogenic markers. Additionally, we provide evidence that Cdc42 also promotes chondrogenesis. Overexpression of Cdc42 in ATDC5 cells resulted in increased expression of Sox5, Sox9, and collagen II but not Sox6, aggrecan, or N-cadherin. Therefore, we demonstrate that Rac1 and Cdc42 are positive regulators of chondrogenesis, but act at least in part through different cellular and molecular mechanisms.Chondrocytes are the cellular component of cartilage, responsible for generating and maintaining its extracellular environment (1). Cartilage has multiple functions such as providing a cushion on the articular surfaces of joints (2), providing a template for the formation of endochondral bone (3), and contributing to fracture repair (4). The formation of cartilage templates in endochondral ossification begins with condensation of mesenchymal cells, increased expression of the cell adhesion molecules N-cadherin and N-CAM, and therefore increased cell-cell interactions (5-7). As cells become chondrogenic, the expression of these adhesion molecules is decreased (8). Cells within these condensations commit to the chondrogenic lineage, acquire a spherical cell morphology and induce expression of the essential chondrogenic transcription factor Sox9 (9, 10). Sox5 and Sox6 cooperate with Sox9 to control chondrogenesis and are themselves under the transcriptional control of Sox9 (9,11,12). Together, these transcription factors activate transcription of the major chondrogenic matrix genes, collagen II and aggrecan (11,(13)(14)(15). Furthermore, increased glycosaminoglycan (GAG) 3 content is another marker of the chondrogenic extracellular matrix (1). The production of glycosaminoglycans are partially regulated by the enzymes chondroitin 4-sulfotransferase 11 (Chst 11) and chondroitin 6-sulfotransferase 3 (Chst 3), which have been determined to be important for proper cartilage and bone formation (16,17).Although many...