Chondrocytes isolated from sternal cartilage of 13-day embryonic chicks were dispersively embedded inside the collagen gels in Ham's F-12 medium containing fetal calf serum. Viability, three-dimensional growth and deposition of extracellular matrix in the living cultures were evidenced by increased cell number, morphology and autoradiographic observations, respectively. The cells increased 2- to 3-fold in 1 week and occupied ' chondrocytic lacunae' surrounded by 'territorial matrix'. A more extensive development of the tissue-like structure was produced by high density cultures. Exogenous collagen seemed to be incorporated or rearranged into the newly formed matrix. This new culture method may provide suitable conditions for differentiated chondrocytes to accumulate metachromatic matrix in vitro.