Enhancing the specific differentiation of pluripotent embryonic stem (ES) cells has been a challenge in the field of tissue engineering. Previously, hepatic cells have been shown to secrete various soluble morphogenic factors to direct mesodermal differentiation of ES cells. In this study, we hypothesized that factors secreted by hepatic cells possess chondrogenic-differentiating effects, and, therefore, the co-culture of hepatic cells would enhance chondrogenesis of ES cells. ES-derived cells(ESDCs) were co-cultured with hepatic cells (HEPA-1C1c7) in three-dimensional bilayered hydrogels. After 3 weeks culture, the histological and biochemical analysis of the HEPA-co-cultured ESDCs revealed a four-fold increase in glycosaminoglycan (GAG) compared to ESDCs cultured alone. This result was supported by real-time PCR analysis, which demonstrated an 80-fold increase in aggrecan expression in co-cultured ESDCs. Additionally, type IIB collagen expression was observed only with co-cultured ESDCs, and immunohistochemical analysis resulted in significantly more positive type II collagen staining with co-cultured ESDCs. Moreover, at day 21, gene expression of other lineages in HEPA-co-cultured ESDCs was either comparable to or lower than those of ESDCs cultured alone. These results indicated that co-culture of ESDCs with hepatic cells significantly enhanced specific chondrogenic differentiation of ESDCs.