Activating enhancer-binding protein (AP)-2epsilon was previously described as a new regulator of integrin alpha(10) expression in cartilage. In this study, we analyzed the expression of AP-2epsilon in differentiated chondrocytes and in human mesenchymal stem cells (HMSCs), which have been differentiated into chondrocytes in vitro. AP-2epsilon is predominantly expressed during the late stages of chondrocyte differentiation, mainly in early hypertrophic cartilage, consistent with immunohistochemical stainings of mouse embryo sections. Furthermore, osteoarthritic chondrocytes, resembling a hypertrophic phenotype, have high AP-2epsilon levels. The AP-2epsilon promoter harbors binding sites for the transcription factors AP-2alpha and Sox9. Both transcription factors strongly activate AP-2epsilon expression in a cooperative manner in the chondrosarcoma cell line SW1353. The inhibition of Sox9 expression by small interfering RNA resulted in decreased AP-2epsilon expression. In addition, direct interaction of Sox9 with the AP-2epsilon promoter could be confirmed by chromatin immunoprecipitation and electromobility shift assays. This is the first study to prove the direct regulation of AP-2epsilon by the transcription factor Sox9, and to indicate that AP-2epsilon potentially has an important role as a modulator of hypertrophic cartilage.