Tissue engineering is a promising approach for the treatment of tissue defects. Mesenchymal stem cells are of potential use as a source of repair cells or of important growth factors for tissue engineering. The purpose of this study was to examine the role of mesenchymal stem cells in meniscal tissue repair. This was tested using several cell and biomaterial-based treatment options for repair of defects in the avascular zone of rabbit menisci. Circular meniscal punch defects (2 mm) were created in the avascular zone of rabbit menisci and left empty or filled with hyaluronan-collagen composite matrices without cells, loaded with platelet-rich plasma, autologous bone marrow, or autologous mesenchymal stem cells. In some experiments, matrices with stem cells were precultured in chondrogenic medium for 14 days before implantation. Rabbits were then allowed free cage movement after surgery for up to 12 weeks. Untreated defects and defects treated with cell-free implants had muted fibrous healing responses. Neither bone marrow nor platelet-rich plasma loaded in matrices produced improvement in healing compared with cell-free implants. The implantation of 14 days precultured chondrogenic stem cell-matrix constructs resulted in fibrocartilage-like repair tissue, which was only partially integrated with the native meniscus. Non-precultured mesenchymal stem cells in hyaluronan-collagen composite matrices stimulated the development of completely integrated meniscus-like repair tissue. The study shows the necessity of mesenchymal stem cells for the repair of meniscal defects in the avascular zone. Mesenchymal stem cells seem to fulfill additional repair qualities besides the delivery of growth factors. © 2010 Wiley Periodicals, Inc. J Biomed Mater Res Part A, 2010.