Mouse embryonic fibroblasts (MEFs) can be differentiated into fully functional chondrocytes in response to bone morphogenetic protein‐2 (BMP‐2). The expression of Sox9, a critical transcription factor for the multiple steps of chondrogenesis, has been reported to be upregulated during this process. But the molecular mechanisms by which BMP‐2 promotes chondrogenesis still remain largely unknown. The aim of the present study was therefore to investigate the underlying mechanism. In the MEFs, BMP‐2 efficiently induced Sox9 expression along with chondrogenic differentiation in a time‐ and dose‐dependent manner. SB203580, a specific inhibitor for p38 pathway, blocked BMP‐2‐induced chondrogenic differentiation as well as Sox9 expression and its transactivation of downstream genes. Forced expression of Smad6, a natural antagonist for BMP/Smad pathway, only inhibited Sox9 protein function without rendering any effects on its mRNA expression. A CCAAT box was identified in Sox9 promoter as the cis‐elements responsible for BMP‐2 stimulation. This study provides insight into the mechanisms underlying BMP‐2‐regulated Sox9 expression and activity in MEFs, and suggests differential roles of BMP‐2/p38 and BMP‐2/Smad pathways in modulating the function of Sox9 during chondrogenesis. J. Cell. Physiol. 217: 228–241, 2008. © 2008 Wiley‐Liss, Inc.