Objective: To investigate the effect of cancellous bone matrix gelatin (BMG) engineered with allogeneic chondrocytes in repairing articular cartilage defects in rabbits.Methods: Chondrocytes were seeded onto three-dimensional cancellous BMG and cultured in vitro for 12 days to prepare BMG-chondrocyte complexes. Under anesthesia with 2.5% pentobarbital sodium (1 ml/kg body weight), articular cartilage defects were made on the right knee joints of 38 healthy New Zealand white rabbits (regardless of sex, aged 4-5 months and weighing 2.5-3 kg) and the defects were then treated with 2.5 % trypsin.Then BMG-chondrocyte complex (Group A, n=18 ),BMG ( Group B, n=10), and nothing ( Group C, n=10)were implanted into the cartilage defects, respectively. The repairing effects were assessed by macroscopic, histologic,transmission electron microscopic (TEM) observation,immunohistochemical examination and in situ hybridization detection, respectively, at 2, 4, 8, 12 and 24 weeks after operation.Results: Cancellous BMG was degraded within 8 weeks after operation. In Group A, lymphocyte infiltration was observed around the graft. At 24 weeks after operation, the cartilage defects were repaired by cartilage tissues and the articular cartilage and subchondral bone were soundly healed. Proteoglycan and type Ⅱ collagen were detected in the matrix of the repaired tissues by Safranin-O staining and immunohistochemical staining,respectively. In situ hybridization proved gene expression of type Ⅱ collagen in the cytoplasm of chondrocytes in the repaired tissues. TEM observation showed that chondrocytes and cartilage matrix in repaired tissues were almost same as those in the normal articular cartilage. In Group B, the defects were repaired by cartilage-fibrous tissues. In Group C, the defects were repaired only by fibrous tissues.Conclusions : Cancellous BMG can be regarded as the natural cell scaffolds for cartilage tissue engineering.Articular cartilage defects can be repaired by cancellous BMG engineered with allogeneic chondrocytes. The nature of repaired tissues is closest to the normal cartilage. Local administration of trypsin can promote the adherence of repaired tissues to host tissues. Transplantation of allogeneic chondrocytes has immunogenicity, but the immune reaction is weak.