Cartilage has a limited self-repair capability and the repair of large cartilage defects remains a challenge in clinic. This study aimed to investigate the effect of mesenchymal stem cells (MSCs) loaded three-dimensional bilayer collagen scaffold for cartilage repair. Cross-linked three-dimensional bilayer collagen scaffolds seeded with or without MSCs were implanted into large cartilage defects (4 mm in diameter; 3 mm in depth) in rabbit knees. The untreated cartilage defects served as control. The tissue response was evaluated at 6 and 12 weeks after implantation by general histology and semi-quantitative histological grading systems. In addition, the repaired tissues were evaluated by mechanical test at 12 weeks after implantation. The MSCs-loaded collagen scaffold group showed the most hyaline cartilage, highest histological scores and compressive modulus. Moreover, it showed a good integration with the subchondral bone and adjacent cartilage. The structure of the novel bilayer collagen scaffolds provided architectural support for the differentiation of MSCs and demonstrated successful induction of in vivo chondrogenesis. These findings suggested that MSCs-loaded bilayer collagen scaffold could be an appealing candidate to be used for cartilage regeneration.