Previous studies showed that coculture of primary chondrocytes (PCs) with various sources of multipotent cells results in a higher relative amount of cartilage matrix formation than cultures containing only chondrocytes. The aim of this study was to investigate the mechanism underlying this observation. We used coculture pellet models of human mesenchymal stem cells (hMSCs) and human PCs or bovine PCs (bPCs) and studied the fate and the contribution to cartilage formation of the individual cell populations during coculture. Enhanced cartilage matrix deposition was confirmed by histology and quantification of total glycosaminoglycan deposition. Species-specific quantitative polymerase chain reaction demonstrated that cartilage matrix gene expression was mainly from bovine origin when bPCs were used. Short tandem repeat analysis and species-specific quantitative polymerase chain reaction analysis of genomic DNA demonstrated the near-complete loss of MSCs in coculture pellets after 4 weeks of culture. In coculture pellets of immortalized MSCs and bPCs, chondrocyte proliferation was increased, which was partly mimicked using conditioned medium, and simultaneously preferential apoptosis of immortalized MSCs was induced. Taken together, our data clearly demonstrate that in pellet cocultures of MSCs and PCs, the former cells disappear over time. Increased cartilage formation in these cocultures is mainly due to a trophic role of the MSCs in stimulating chondrocyte proliferation and matrix deposition by chondrocytes rather than MSCs actively undergoing chondrogenic differentiation.