Transforming growth factor beta (TGFbeta) is often used in cartilage tissue engineering to increase matrix formation by cells with various phenotypes. However, adverse effects of TGFbeta, such as extensive crosslinking in cultured fibroblasts, have also been reported. Our goal was to study effects of TGFbeta on collagen cross-linking and evaluating the role of cellular phenotype and physical environment. We therefore used four different cell populations in two very different physical environments: primary and expanded chondrocytes and fibroblasts embedded in alginate gel and attached to tissue culture plastic. Matrix production, collagen cross-linking, and alpha-smooth muscle actin (alphaSMA) were analyzed during 4 weeks with or without 2.5 ng/ mL TGFbeta2. TGFbeta2 did not affect collagen deposition by primary cells. In expanded cells, TGFbeta2 increased collagen deposition. Chondrocytes and fibroblasts in monolayer produced more collagen cross-links with TGFbeta2. In alginate, primary and expanded cells displayed an unexpected decrease in collagen cross-linking with TGFbeta2. alphaSMA was not present in alginate cultures and barely upregulated by TGFbeta2. Organized alphaSMA fibers were present in all monolayer cultures and became more pronounced with TGFbeta2. This study demonstrates that the physical environment determined by the substrate used co-determines the response of cells to TGFbeta. The presence of mechanical stress, determined with alphaSMA-staining, is probably responsible for the increase in collagen cross-linking upon addition of TGFbeta.