Abstract Ectopic expression of Smurf2 in chondrocytes and perichondrial cells accelerated endochondral ossification by stimulating chondrocyte maturation and osteoblast development through upregulation of β-catenin in Col2a1-Smurf2 embryos. The mechanism underlying Smurf2-mediated morphological changes during embryonic development may provide new mechanistic insights and potential targets for prevention and treatment of human osteoarthritis. Introduction: Our recent finding that adult Col2a1-Smurf2 mice have an osteoarthritis-like phenotype in knee joints prompted us to examine the role of Smurf2 in the regulation of chondrocyte maturation and osteoblast differentiation during embryonic endochondral ossification. Materials and Methods: We analyzed gene expression and morphological changes in developing limbs by immunofluorescence, immunohistochemistry, Western blot, skeletal preparation, and histology. A series of markers for chondrocyte maturation and osteoblast differentiation in developing limbs were examined by in situ hybridization. Results: Ectopic overexpression of Smurf2 driven by the Col2a1 promoter was detected in chondrocytes and in the perichondrium/periosteum of 16.5 dpc transgenic limbs. Ectopic Smurf2 expression in cells of the chondrogenic lineage inhibited chondrocyte differentiation and stimulated maturation; ectopic Smurf2 in cells of the osteoblastic lineage stimulated osteoblast differentiation. Mechanistically, this could be caused by a dramatic increase in the expression of β-catenin protein levels in the chondrocytes and perichondrial/periosteal cells of the Col2a1-Smurf2 limbs. Conclusions: Ectopic expression of Smurf2 driven by the Col2a1 promoter accelerated the process of endochondral ossification including chondrocyte maturation and osteoblast differentiation through upregulation of β-catenin, suggesting a possible mechanism for development of osteoarthritis seen in these mice.