Human umbilical cord-derived mesenchymal stem cells (hUC-MSCs) possess the potential for chondrogenic differentiation, offering a promising alternative source for cartilage regeneration. To address the limited availability and expansion capacity of autologous chondrocytes, we investigated the effect of co-overexpression of Sox9, TGFβ1, and type II collagen (Col II) on the chondrogenic differentiation of hUC-MSCs using both 2D and 3D pellet culture systems. Following transfection, the cells exhibited a chondrocyte-like morphology and a marked downregulation of the stemness marker Stro-1. After 21 days in a 3D pellet culture system, the cells formed cartilage-like tissue characterized by the strong expression of chondrocyte-specific genes (Sox9, TGFβ1, Col II, Aggrecan) along with the significant secretion of sulfated glycosaminoglycans (sGaGs). These effects were attributed to enhanced cell–cell contact and extracellular matrix interactions promoted by the 3D environment. Our findings suggest that genetically modified hUC-MSCs cultured in a 3D pellet system represent a robust in vitro model for cartilage regeneration, with potential applications in transplantation and drug toxicity screening.