Objective. Monolayer expansion of human articular chondrocytes (HACs) is known to result in progressive dedifferentiation of the chondrocytes and loss of their stable cartilage formation capacity in vivo. For an optimal outcome of chondrocyte-based repair strategies, HACs capable of ectopic cartilage formation may be required. This study was undertaken to identify secreted candidate molecules, in supernatants of cultured HACs, that could serve as predictors of the ectopic cartilage formation capacity of cells. Methods. Standardized medium supernatants (n = 5 knee cartilage samples) of freshly isolated HACs (PD0) and of HACs expanded for 2 or 6 population doublings (PD2 and PD6, respectively) were screened by a multiplexed immunoassay for 15 distinct interleukins, 8 matrix metalloproteinases (MMPs), and 11 miscellaneous soluble factors. Cartilage differentiation markers such as cartilage oligomeric matrix protein and YKL-40 were determined by enzyme-linked immunosorbent assay. HACs from each culture were subcutaneously transplanted into SCID mice, and the capacity of the chondrocytes to form stable cartilage was examined histologically 4 weeks later. Results. Whereas freshly isolated (PD0) HACs generated stable ectopic cartilage that was positive for type II collagen, none of the cell transplants at PD6 formed cartilaginous matrix. Loss of the ectopic cartilage formation capacity between PD0 and PD6 correlated with a drop in the secretion of MMP-3 to <10% of initial levels, whereas changes in the other investigated molecules were not predictive. Chondrocytes with MMP-3 levels of ≥20% of initial levels synthesized cartilaginous matrix, whereas those with low MMP-3 levels (<10% of initial levels) at PD2 failed to regenerate ectopic cartilage. Conclusion. Loss of the capacity for stable ectopic cartilage formation in the course of HAC dedifferentiation can be predicted by determining the relative levels of MMP-3, demonstrating that standardized culture supernatants can be used for quality control of chondrocytes dedicated for cell therapeutic approaches.