The objective of this study was to develop an engineered rat hyaline cartilage by culturing articular chondrocytes on three-dimensional (3D) macroporous poly(DL-lactic-co-glycolic acid) (PLGA) sponges under chondrogenic induction and microgravity bioreactor conditions. Experimental groups consisted of 3D static and dynamic cultures, while a single cell monolayer (2D) served as the control. The effect of seeding conditions (static vs. dynamic) on cellularization of the scaffolds was investigated. MTT assay was used to evaluate the number of viable cells in each group at different time points. Formation of a hyaline-like cartilage was evaluated for up to 4 weeks in vitro. While 2D culture resulted in cell sheets with very poor matrix production, 3D culture was in the favor of tissue formation. A higher yield of cell attachment and spatially uniform cell distribution was achieved when dynamic seeding technique was used. Dynamic culture promoted cell growth and infiltration throughout the sponge structure and showed the formation of cartilage tissue, while chondrogenesis appeared attenuated more towards the outer region of the constructs in the static culture group. Medium supplemented with TGF-beta 1 (5 ng/ml) had a positive impact on proteoglycan production as confirmed by histochemical analyses with Alcian blue and Safranin-O stainings. Formation of hyaline-like tissue was demonstrated by immunohistochemistry performed with antibodies against type II collagen and aggrecan. SEM confirmed higher level of cellularization and cartilage tissue formation in bioreactor cultures induced by TGF-beta 1. The data suggest that PLGA sponge inside rotating bioreactor with chondrogenic medium provides an environment that mediates isolated rat chondrocytes to redifferentiate and form hyaline-like rat cartilage, in vitro.