Cells obtained from bone marrow or embryonic donors are the most frequent source of pluripotential cells for tissue engineering and cell-based therapy. Chondrocytes obtained from preadipocyte differentiation can be used to create cartilage, that can be used for reconstruction of deformities and defects in the absence of native cartilage. Predipocytes were extracted from the stromal fraction of the fat obtained form the groin fat pad of Zucker rats, and incubated in preadipocyte medium (PAM) that supported cell growth but not cell differentiation. Beta-galactaside assay confirmed the retention of preadipocyte morphology. At 85% confluency, the pre-adipocytes were induced to differentiation. Red oil histological and Alcian Blue staining was performed. Once Chondrocyte differentiation had been confirmed, the chondrocytes were placed in two different scaffolding materials (Chitosan and Surgisis). The scaffolds were placed in subcutaneous pockets on the dorsum of the rat, harvested in 8 weeks and studied hisotlogically using alcian blue and H & E staining. The scaffolds with the chondrocytes were studied after harvesting and revealed the presence of chondrocytes embedded in a glycosaminoglycan matrix that were suggestive of cartilage formation. Pre-adipocytes obtained from fat undergo invitro differentiation to chondrocytes when exposed to specific factors known to induce these differentiation pathways.