Articular cartilage lacks the ability to repair itself and consequently defects in this tissue do not heal. Tissue engineering approaches, employing a scaffold material and cartilage producing cells (chondrocytes), hold promise for the treatment of such defects. In these strategies the limitation of nutrients, such as oxygen, during in vitro culture are of major concern and will have implications for proper bioreactor design. We recently demonstrated that oxygen gradients are indeed present within tissue engineered cartilaginous constructs. Interestingly, oxygen, besides being an essential nutrient, is also a controlling agent of developmental processes including cartilage formation. However, the specific role of oxygen in these processes is still obscure despite the recent advances in the field. In particular, the outcome of published investigations is inconsistent regarding the effect of oxygen tension on chondrocytes. Therefore, this article describes the possible roles of oxygen gradients during embryonic cartilage development and reviews the data reported on the effect of oxygen tension on in vitro chondrocyte proliferation and differentiation from a tissue engineering perspective. Furthermore, possible causes for the variance in the data are discussed. Finally, recommendations are included that may reduce the variation, resulting in more reliable and comparable data.