Tissue engineered cartilage substitutes, which induce the process of endochondral ossification, represent a regenerative strategy for bone defect healing. Such constructs typically consist of multipotent mesenchymal stromal cells (MSCs) forming a cartilage template in vitro, which can be implanted to stimulate bone formation in vivo. The use of MSCs of allogeneic origin could potentially improve the clinical utility of the tissue engineered cartilage constructs in three ways. First, ready-to-use construct availability can speed up the treatment process. Second, MSCs derived and expanded from a single donor could be applied to treat several patients and thus the costs of the medical interventions would decrease. Finally, it would allow more control over the quality of the MSC chondrogenic differentiation. However, even though the envisaged clinical use of allogeneic cell sources for bone regeneration is advantageous, their immunogenicity poses a significant obstacle to their clinical application. The aim of this review is to increase the awareness of the role played by immune cells during endochondral ossification, and in particular during regenerative strategies when the immune response is altered by the presence of implanted biomaterials and/or cells. More specifically, we focus on how this balance between immune response and bone regeneration is affected by the implantation of a cartilaginous tissue engineered construct of allogeneic origin.