The long-term objective of this application is to develop a stem-cell based osteochondral biomaterial that can be used for reconstructing joints damaged by osteoarthritis (OA) and trauma. Toward this objective, we have developed a novel gradient scaffold technology that affords precise spatiotemporal control of the scaffold design, creating both signal (growth factor) and mechanical stiffness gradients of any desired profile. Although signal gradients are vital to embryogenesis, wound healing, and countless other biological processes, they have yet to be systematically investigated in musculoskeletal tissue engineering. Moreover, stiffness gradients remain virtually unexplored in biomaterials, and our unique approach introduces an entirely new technology to accommodate the contrasting mechanical demands of bone and cartilage. Also new to musculoskeletal tissue engineering are umbilical cord matrix stem cells (UCMSCs), which possess tremendous potential with numerous key advantages over other stem cell sources. The overall goal of this proposal is thus to employ a combination of these innovative approaches to engineer seamless osteochondral constructs for the treatment of rabbit knee defects. The significance of the seamless design lies in the ability to create a single, integrated osteochondral tissue instead of discrete bone and cartilage regions. The chief hypothesis is that UCMSCs in a novel gradient-driven scaffold design will lead to a mechanically viable osteochondral construct that will mimic the seamless transition of native tissue from bone to zonally organized cartilage. To test this hypothesis, we propose the following specific aims: 1) to develop and characterize novel scaffolds containing stiffness- and growth factor-gradients, 2) to engineer seamless osteochondral constructs in vitro, and 3) to determine the efficacy of osteochondral constructs in a rabbit knee defect model. Our overall strategy is to develop a heterogeneous scaffold that will contain a mechanical stiffness gradient, increasing from the cartilage region to the bone region, and also release precisely-controlled and opposing gradients of chondrogenic and osteogenic factors to differentiate stem cells. These gradients are accomplished by varying the relative numbers of osteogenic and chondrogenic microspheres along the scaffold length, which differ in material composition and encapsulated signal. The material composition and growth factor loading for these microspheres will be determined in the design-driven first aim. The gradient-based scaffolds will be seeded with stem cells in the next two aims, where UCMSCs will be compared to the long standing gold standard, bone-marrow derived mesenchymal stem cells (BMSCs), to test the hypothesis that UCMSCs will outperform BMSCs both in vitro and in vivo. Successful completion of this project will deliver gradient-based scaffolds comprised of FDA-approved materials in combination with a readily available, non-controversial, and immune-compatible human cell source. Moreover, this technology will have a high impact on other fields in the future where a gradient or integrated interface is desired, such as nerve regeneration, the ligament/bone interface, and beyond.