Carbon nanotubes (CNTs) are cylindrical allotropes of carbon that are nanometers in diameter and posses unique physical properties, positioning them as ideal materials for studying physiology at a single cell level. CNTs have the potential to become a very important component of medical therapeutics, likely acting as (a) drug delivery system [1], (b) existing as an interfacial layer in surgical implants [2,3], or (c) acting as scaffolding in tissue engineering [4,8]. While some studies have explored the use of CNTs as a novel material in regenerative medicine, they have not yet been fully evaluated in cellular systems. One major limitation of CNTs that must be overcome is their inherent cytotoxicity. The goal of this study is to assess the long-term biocompatibility of CNTs for chondrocyte growth. We hypothesize that CNT-based material in tissue engineering can provide an improved molecular sized substrate for stimulation of cellular growth, and structural reinforcement of the scaffold mechanical properties. Here we present data on the effects of CNTs on chondrocyte viability and biochemical deposition examined in composite materials of hydrogels + CNTs mixtures. Also, the effects of CNTs surface functionalization with polyethlyne glycol (PEG) or carboxyl groups (COOH) were examined.