MicroRNAs (miRNAs) play an essential role in the chondrogenesis and the progression of osteoarthritis (OA). This study aimed to determine miRNAs associated with chondrogenesis of human mesenchymal stem cells (hMSCs) and chondrocyte metabolism. MiRNAs were screened in hMSCs during chondrogenesis by RNA-seq and qRT-PCR. MiRNA expression was determined in primary human chondrocytes (PHCs), and degraded cartilage samples. MiRNA mimics and inhibitors were transfected to cells to determine the effect of miRNA. Bioinformatic analysis and luciferase reporter assays were applied to determine the target gene of miRNA. The results demonstrated that miR-520d-5p was increased in hMSCs chondrogenesis. The overexpression and knockdown of miR-520d-5p promoted and inhibited chondrogenesis, and regulated chondrocyte metabolism. Histone deacetylase 1 (HDAC1) was decreased in hMSCs chondrogenesis, and HDAC1 was a targeting gene of miR-520d-5p. CI994, HDAC1 inhibitor, elevated cartilage-specific gene expressions and promoted hMSCs chondrogenesis. In IL-1β-treated PHCs, CI994 promoted AGGRECAN expression and suppressed MMP-13 expression, abolishing the effect of IL-1β on PHCs. Taken together, these results suggest that miR-520d-5p promotes hMSCs chondrogenesis and regulates chondrocyte metabolism through targeting HDAC1. This study provides novel understanding of the molecular mechanism of OA progression.