This study examined whether the oral administration of low-molecular-weight collagen peptide (LMCP) containing 3% Gly-Pro-Hyp with >15% tripeptide (Gly-X-Y) content could ameliorate osteoarthritis (OA) progression using a rabbit anterior cruciate ligament transection (ACLT) model of induced OA and chondrocytes isolated from a patient with OA. Oral LMCP administration (100 or 200 mg/kg/day) for 12 weeks ameliorated cartilage damage and reduced the loss of proteoglycan compared to the findings in the ACLT control group, resulting in dose-dependent (p < 0.05) improvements of the OARSI score in hematoxylin & eosin (H&E) and Safranin O staining. In microcomputed tomography analysis, LMCP also significantly (p < 0.05) suppressed the deterioration of the microstructure in tibial subchondral bone during OA progression. The elevation of IL-1βand IL-6 concentrations in synovial fluid following OA induction was dose-dependently (p < 0.05) reduced by LMCP treatment. Furthermore, immunohistochemistry illustrated that LMCP significantly (p < 0.05) upregulated type II collagen and downregulated matrix metalloproteinase-13 in cartilage tissue. Consistent with the in vivo results, LMCP significantly (p < 0.05) increased the mRNA expression of COL2A1 and ACAN in chondrocytes isolated from a patient with OA regardless of the conditions for IL-1βinduction. These findings suggest that LMCP has potential as a therapeutic treatment for OA that stimulates cartilage regeneration.