Various forms of mechanical stimulation have been shown to enhance chondrogenesis of mesenchymal stem cells (MSCs). However, the response of MSCs undergoing chondrogenesis to such signals has been shown to depend on the temporal application of loading. The objective of this study was to determine the effect of dynamic compression on cartilage-matrix-specific gene expression and to relate this response to the local biochemical environment and cell phenotype at the time of loading. At 0, 7, 14, and 21 days extracellular matrix (ECM) deposition within MSC-seeded agarose hydrogels due to transforming growth factor-beta 3 stimulation was determined biochemically and histologically, and then reverse transcription-polymerase chain reaction was used to examine the effects of dynamic compression on cartilage-matrix-specific gene expression. The results of these experiments show that the local environment in the core of the constructs is more favorable for chondrogenesis in comparison to the annulus, as evident from both ECM synthesis and gene expression. Additionally, we found that the response of the cells to mechanical stimulus varied with both the spatial region within the constructs and the temporal application of loading. Dynamic compression applied at day 21 was found to enhance levels of cartilage matrix gene expression following a peak in expression levels at day 14 in free swelling constructs, suggesting that mechanical signals play a key role in the maintenance of a chondrogenic phenotype. The application of mechanical stimulus to enhance cartilage ECM synthesis may be an important tool in regenerative medicine-based cartilage repair. The results of this study suggest that a chondrogenic phenotype and/or a well-developed pericellular matrix must first be established before dynamic compression can have a positive effect on cartilage-matrix-specific gene expression.