Type II collagen is a prospective chondro-inductive matrix for bone marrow mesenchymal stem cells (BMSCs), a key component of the extracellular matrix of cartilage; however, its application is limited by deficient fibrillogenesis and gelation. Herein, type II collagen methacrylamide (Col-II-MA) was synthesized by an amidation reaction between the ε-amino groups on collagen lysine and methacrylic anhydride to enable photo-crosslinking of the collagen, thus accomplishing a one-step preparation of mono-component type II collagen hydrogel for the first time. BMSCs encapsulated within the Col-II-MA hydrogel exhibited accelerated proliferation and morphological changes that are similar to chondrogenesis, as well as up-regulated expression of chondrogenic genes and remarkable secretion of the cartilaginous matrix. These results demonstrated that this effective synthetic approach facilitated the formation of photo-active type II collagen hydrogel with a well-preserved triple helical conformation, which provides BMSCs with a favorable microenvironment for growth and the essential chondro-inductive matrix for differentiation. Furthermore, the hydrogel is applicable to microfabrication techniques and displays promise for future applications in microscale tissue engineering.