Bone morphogenetic protein 4 (BMP4) and growth/differentiation factor 5 (GDF5) are closely related protein family members and regulate early cartilage patterning and differentiation. In this study, we compared the functional outcome of their actions systematically at various stages of chondrogenesis in mouse embryonic limb bud mesenchyme grown in micromass cultures. Overall, both growth factors enhanced cartilage growth and differentiation in these cultures. Uniquely, BMP4 not only accelerated the formation and maturation of cartilaginous nodules, but also induced internodular mesenchymal cells to express cartilage differentiation markers. On the other hand, GDF5 increased the number of prechondrogenic mesenchymal cell condensation and cartilaginous nodules, without altering the overall pattern of differentiation. In addition, GDF5 caused a more sustained elevated expression level of Sox9 relative to that associated with BMP4. BMP4 accelerated chondrocyte maturation throughout the cultures and sustained an elevated level of Col10 expression, whereas GDF5 caused a transient increase in Col10 expression. Taken together, we conclude that BMP4 is instructive to chondrogenesis and induces mesenchymal cells toward the chondrogenic lineage. Furthermore, BMP4 accelerates the progression of cartilage differentiation to maturation. GDF5 enhances cartilage formation by promoting chondroprogenitor cell aggregation, and amplifying the responses of cartilage differentiation markers. These differences may serve to fine-tune the normal cartilage differentiation program, and can be exploited for the molecular manipulation in biomimetics.