Objective To explore the impact of inhibition of transforming growth factor-β(TGF-β) signaling by local administration of halofuginone (HF) via osmotic infusion pumps on osteoarthritis (OA) pathogenesis and its underlying mechanism. Methods Knee OA models were induced by the anterior cruciate ligament transection (ACLT) in 30 3-month-old male SD rats. They were randomized by random number table into 3 equal groups (n=10): Sham, Vehicle+ACLT and HF+ACLT ones. Specific admin-istration of drugs was achieved via osmotic infusion pumps directly implanted in subchondral bone. Safranin O and fast green, H&E, immunofluorescence staining, CT-based microangiography and bone micro-CT (μCT) were used to measure alterations in articular cartilage and subchondral bone [BV(bone volume)/TV (tissue volume), Tb.Pf (trabecular pattern factor), Tb.N (trabecular number), SBP.Th(subchondral bone plate.Th), pSmad2/3, Nestin, and OARSI (Osteoarthritis Research Society International) scoring]. Results Knee OA models and drug administration devices in subchondral bone were successfully established in rats. Sham and HF+ACLT groups had greater subchondral BV/TV(0.381±0.060 mm3 and 0.322±0.060 mm3), SBP.Th (0.570±0.042 mm and 0.521±0.122 mm) and Tb.N (4.871±0.214 mm-1 and 4.364±0.466 mm-1) than Vehicle+ACLT group did (0.229±0.063) mm3, 0.324±0.165 mm and 2.978±0.804 mm-1, respectively); Sham and HF+ACLT groups had less subchondral Tb.Pf (-0.880±0.210 mm-1 and -0.377±0.259 mm-1), lower expression of pSmad2/3 (90.2±40.0 and 90.8±34.5) and Nestin (16.9±5.8 and 18.5±4.7) and OARSI scores (1.2±0.7 and 2.5±1.9) than Vehicle+ACLT group did (0.057±0.535 mm-1, 142.7±37.0, 25.9±7.4 and 5.4±2.8, respectively). All the above differences were statistically significant (P 0.05). Conclusion Subchondral administration of HF can inhibit TGF-β induced erroneous recruitment of mesenchymal stem cells in subchondral bone, thus attenuating OA progression. Key words: Osteoarthritis, knee; Transforming growth factor-β; Mesenchymal stem cells; Subchondral bone