Production of cartilaginous particles for regenerative medicine requires a large supply of chondrocytes and development of suitable production techniques. Previously, we successfully produced human induced pluripotent stem cell (hiPSC)-derived limb bud mesenchymal cells (ExpLBM cells) with a high chondrogenic differentiation potential that stably proliferate. It may be possible to use these cells in combination with a stirred bioreactor to develop a tissue-engineered cell culture technology with potential for scale-up to facilitate production of large amounts of cartilaginous particles. ExpLBM cells derived from 414C2 and Ff-I 14s04 (human leukocyte antigen homozygous) hiPSCs were seeded into a stirred bioreactor containing cartilage induction medium. To characterize the cartilaginous particles produced, we performed real-time quantitative reverse transcription-polymerase chain reaction and histological analyses. Additionally, we transplanted the cartilage tissue into osteochondral defects of immunocompromised rats to assess its functionality, and evaluated engraftment of the grafted tissue. We successfully produced large amounts of cartilaginous particles via cartilage induction culture in a stirred bioreactor. This tissue exhibited significantly increased expression levels of type II collagen (COL2), aggrecan (ACAN), and SRY-box transcription factor 9 (SOX9), as well as positive Safranin O and Toluidine blue staining, indicating that it possesses characteristics of hyaline cartilage. Furthermore, engrafted tissues in osteochondral knee defects of immunodeficient rats were positively stained for human vimentin, COL2, and ACAN as well as with Safranin O. In this study, we successfully generated large amounts of hiPSC-derived cartilaginous particles using a combination of tissue engineering techniques. This method is promising as a cartilage regeneration technology with potential for scale-up.