Catalpol is a natural product with promising anti-inflammatory effects, however, its effects on chondrocytes and osteoarthritis (OA) have not been well investigated. OA is a painful and debilitating joint disease that affects people worldwide. Traditional Chinese Medicine has been sought to treat OA, including the Rehmannia extract, Catalpol. Here, we examined the effects of Catalpol, a plant derivative used in traditional Chinese medicine, on ATDC5 chondrocytes originating from mouse teratocarcinoma cells stimulated with interleukin-1β (IL-1β) to mimic the OA cellular environment. Catalpol significantly reduced matrix metalloproteinase-1, -3, -13 (MMP-1, -3, -13), a disintegrin and metalloproteinase with thrombospondin motifs -4, -5 (ADAMTS-4, -5) against IL-1β, demonstrating a likely anti-cartilage degradation activity. We also found that Catalpol exerted a significant anti-oxidative stress effect by downregulating the production of inducible nitric oxide synthase (iNOS), nitric oxide (NO), reactive oxygen species (ROS), and malondialdehyde (MDA). Catalpol treatment significantly reduced the levels of several key inflammatory factors, including Prostaglandin E₂ (PGE₂), cyclooxygenase-2 (COX-2), interleukin-8 (IL-8), and monocyte chemoattractant protein-1 (MCP-1). We further demonstrate that the effects of Catalpol were mediated by the nuclear factor -κB (NF-κB) pathway via downregulation of the phosphorylation of inhibitor of nuclear factor κB-α (IκBα). This was confirmed by measuring p38 and p65 protein levels as well as the luciferase activity of NF-κB. Altogether, we demonstrate the potential of Catalpol as a novel treatment agent against cartilage matrix degradation, oxidative stress, and inflammation in OA.