Osteoarthritis (OA) is the most prevalent form of joint disease and lacks effective treatment. Cell-based therapy through intra-articular injection holds great potential for effective intervention at its early stage. Despite the promising outcomes, major barriers for successful clinical application such as lack of specific targeting of transplanted cells still remain. Here, novel polyethylenimine-wrapped iron oxide nanoparticles (PEI/IONs) were utilized as a magnetic agent, and the in vitro efficiency of PEI/ION labeling, and the influence on the chondrogenic properties of chondrocytes were evaluated; the in vivo feasibility of magnetic-targeting intra-articular injection with PEI/ION labeled autologous chondrocytes was investigated using a rabbit articular cartilage defect model. Our data showed that chondrocytes were conveniently labeled with PEI/IONs in a time- and dose-dependent manner, while the viability was unaffected. No significant decrease in collagen type-II synthesis of labeled chondrocytes was observed at low concentration. Macrographic and histology evaluation at 1 week post intra-articular injection revealed efficient cell delivery at chondral defect sites in the magnetic-targeting group. In addition, chondrocytes in the defect area presented a normal morphology, and the origin of cells within was confirmed by immunohistochemistry staining against BrdU and Prussian blue staining. The present study shows proof of concept experiments in magnetic-targeting of PEI/ION labeled chondrocytes for articular cartilage repair, which might provide new insight to improve current cartilage repair strategies.