The differentiation of mesenchymal stem cells (MSCs) into chondrocytes and osteoblasts is minutely regulated by bone morphogenetic proteins (BMPs) and various factors. There is no study describing the role of noggin in the differentiation from MSCs to chondrocytes or osteoblasts. We thus examined the effect of noggin on chondrogenesis and osteogenesis in a human cell line that expresses chondrocytic phenotypes, and the role of noggin in these processes. Noggin induces chondrogenic differentiation, and its repression induces osteogenic differentiation through BMP effects. Noggin is reported to bind several BMPs and to inhibit their functions, but its exact role is not yet clarified. USAC cells usually show chondrogenic phenotypes and also have the potential to differentiate into osteoblasts and adipocytes under some circumstances. We investigated the effects of noggin on chondrogenic and osteogenic differentiation of USAC cells in vivo and in vivo. After USAC cells were treated with noggin antisense oligonucleotide (As-Noggin) or noggin protein (rhNoggin), RT-PCR was performed to detect mRNAs of type I collagen (Col I), type II collagen (Col II), Cbfal, aggrecan (AG), Sox9 and osteocalcin (OC) on days 3, 7 and 14. Western blot analysis was done to detect Col II, BMP-2, BMP-4, Cbfal and OC proteins. Toluidine blue staining and immunostaining for Col II, BMP-2, Cbfal and OC were also performed. As-Noggin induced the up-regulation of Col I and OC mRNA expression in USAC cells time-dependently, while it down-regulated the expression of Col II and AG mRNAs. As-Noggin stimulated BMP-2, Cbfal and OC production, but it reduced the production of Col II and BMP-4. Moreover, OC mRNA expression and BMP-2 production were down-regulated by the addition of rhNoggin. The same results were obtained by immunostaining. These results suggest that noggin may regulate chondrogenic and osteogenic differentiation through the production of BMP-2 and BMP-4.