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Abstract Osteoarthritis (OA) is a progressive and irreversible degenerative joint disease that is characterized by cartilage destruction, osteophyte formation, subchondral bone remodeling, and synovitis. Despite affecting millions of patients, effective and safe disease-modifying osteoarthritis drugs are lacking. Here we reveal an unexpected role for the small molecule 5-aminosalicylic acid (5-ASA), which is used as an anti-inflammatory drug in ulcerative colitis. We show that 5-ASA competes with extracellular-matrix collagen-II to bind to osteoclast-associated receptor (OSCAR) on chondrocytes. Intra-articular 5-ASA injections ameliorate OA generated by surgery-induced medial-meniscus destabilization in male mice. Significantly, this effect is also observed when 5-ASA was administered well after OA onset. Moreover, mice with DMM-induced OA that are treated with 5-ASA at weeks 8–11 and sacrificed at week 12 have thicker cartilage than untreated mice that were sacrificed at week 8. Mechanistically, 5-ASA reverses OSCAR-mediated transcriptional repression of PPARγ in articular chondrocytes, thereby suppressing COX-2-related inflammation. It also improves chondrogenesis, strongly downregulates ECM catabolism, and promotes ECM anabolism. Our results suggest that 5-ASA could serve as a DMOAD.