Most cartilaginous tumors are formed during skeletal development in locations adjacent to growth plates, suggesting that they arise from disordered endochondral bone growth. Fibroblast growth factor receptor (FGFR)3 signaling plays essential roles in this process; however, the role of FGFR3 in cartilaginous tumorigenesis is not known. In this study, we found that postnatal chondrocyte-specific Fgfr3 deletion induced multiple chondroma-like lesions, including enchondromas and osteochondromas, adjacent to disordered growth plates. The lesions showed decreased extracellular signal-regulated kinase (ERK) activity and increased Indian hedgehog (IHH) expression. The same was observed in Fgfr3-deficient primary chondrocytes, in which treatment with a mitogen-activated protein kinase (MEK) inhibitor increased Ihh expression. Importantly, treatment with an inhibitor of IHH signaling reduced the occurrence of chondroma-like lesions in Fgfr3-deficient mice. This is the first study reporting that the loss of Fgfr3 function leads to the formation of chondroma-like lesions via downregulation of MEK/ERK signaling and upregulation of IHH, suggesting that FGFR3 has a tumor suppressor-like function in chondrogenesis.