Bone marrow-derived mesenchymal stem cells (BMSCs) have long been considered the criterion standard for stem cell sources in musculoskeletal tissue engineering. The true test of a stem cell source is a side-by-side comparison with BMSCs. Human umbilical cord-derived mesenchymal stromal cells (hUCMSCs), one such candidate with high potential, are a fetus-derived stem cell source collected from discarded tissue (Wharton's jelly) after birth. Compared with human BMSCs (hBMSCs), hUCMSCs have the advantages of abundant supply, painless collection, no donor site morbidity, and faster and longer self-renewal in vitro. In this 6-week study, a chondrogenic comparison was conducted of hBMSCs and hUCMSCs in a three-dimensional (3D) scaffold for the first time. Cells were seeded on polyglycolic acid (PGA) scaffolds at 25 M cells/mL and then cultured in identical conditions. Cell proliferation, biosynthesis, and chondrogenic differentiation were assessed at weeks 0, 3, and 6 after seeding. At weeks 3 and 6, hUCMSCs produced more glycosaminoglycans than hBMSCs. At week 6, the hUCMSC group had three times as much collagen as the hBMSC group. Immunohistochemistry revealed the presence of collagen types I and II and aggrecan in both groups, but type II collagen staining was more intense for hBMSCs than hUCMSCs. At week 6, the quantitative reverse transcriptase polymerase chain reaction (RT-PCR) revealed less type I collagen messenger RNA (mRNA) with both cell types, and more type II collagen mRNA with hBMSCs, than at week 3. Therefore, it was concluded that hUCMSCs may be a desirable option for use as a mesenchymal cell source for fibrocartilage tissue engineering, based on abundant type I collagen and aggrecan production of hUCMSCs in a 3D matrix, although further investigation of signals that best promote type II collagen production of hUCMSCs is warranted for hyaline cartilage engineering.