Chondrocytes cultured in agarose hydrogels develop a functional extracellular matrix. Application of dynamic strain at physiologic levels to these constructs over time can increase their mechanical properties. In this study, the effect of seeding density (20 and 60×106 cells/ml) on tissue elaboration was investigated. Higher seeding densities increased tissue properties in free-swelling culture, with constructs seeded at 20 and 60×106 cells/ml reaching maximum values over the 63 day culture period of aggregate modulus H_A:​ 43±15 kPa, Young’s modulus E Y:​ 39±3 kPa, and glycosaminglycan content [GAG]:​ 0.96%±0.13% wet weight;​ and H_A:​ 58±12 kPa, E_Y:​ 60±5 kPa, and [GAG]:​ 1.49% ± 0.26% wet weight, respectively. It was further observed that the application of daily dynamic deformational loading to constructs seeded at 20×10⁶ cells/ml enhanced biochemical content (∼150%) and mechanical properties (∼threefold) compared to free-swelling controls by day 28. However, at a concentration of 60×10⁶ cells/ml, no difference in mechanical properties was found in loaded samples versus their free-swelling controls. Multiple regression analysis showed that the mechanical properties of the tissue constructs depend more strongly on collagen content than GAG content;​ a finding that is more pronounced with the application of daily dynamic deformational loading. Our findings provide evidence for initial cell seeding density and nutrient accessibility as important parameters in modulating tissue development of engineered constructs, and their ability to respond to a defined mechanical stimulus.