Induced pluripotent stem cell (iPSC) technology allows pathomechanistic and therapeutic investigation of human heritable disorders affecting tissue types whose collection from patients is difficult or even impossible. Among them are cartilage diseases. Over the past decade, iPSC-chondrocyte disease models have been shown to exhibit several key aspects of known disease mechanisms. Concurrently, an increasing number of protocols to differentiate iPSCs into chondrocytes have been published, each with its respective (dis)advantages. In this review we provide a comprehensive overview of the different differentiation approaches, the hitherto described iPSC-chondrocyte disease models and mechanistic and/or therapeutic insights that have been derived from their investigation, and the current model limitations. Key lessons are that the most appropriate differentiation approach is dependent upon the cartilage disease under investigation and that further optimization is still required to recapitulate the in vivo cartilage.