Chondrogenic differentiation of embryonic stem cells (ESCs) via embryoid bodies (EBs) is an established model to investigate chondrogenesis signaling pathways and molecular mechanisms in vitro. Our aim has been to improve upon the number of differentiated cells needed for the in vitro development of functional cartilage. Chondrogenic differentiation of buffalo ESCs was modulated by bone morphogenetic protein 2 (BMP-2), fibroblast growth factor 10 (FGF-10), transforming growth factor-beta1 (TGF-β1) individually and their combination. ESCs differentiation into chondrocytes was characterized by the appearance of Alcian blue-stained nodules and the expression of cartilage-associated genes (RT-PCR) and protein (immunocytochemistry). BMP-2 or FGF-10 treatment enhanced chondrogenic differentiation, whereas TGF-β1 treatment inhibited buffalo ESC-derived chondrogenesis. The combination of BMP-2 and FGF-10 was the most effective treatment. This treatment resulted in a higher number of Alcian blue-positive nodules by 15.2-fold, expression of the mesenchymal cell marker scleraxis gene by 3.25-fold, and the cartilage matrix protein collagen II gene and protein 1.9- and 7-fold, respectively, compared to the untreated control group. Chondrogenesis was also recapitulated from mesenchymal and chondrogenic progenitor cells, resulting in the establishment of mature chondrocytes. Thus, buffalo ESCs can be successfully triggered in vitro to differentiate into chondrocyte-like cells by specific growth factors, which may provide a novel in vitro model for further investigation of the regulatory mechanism(s) involved.