Inflammation and poor viability of chondrocytes result in the degradation of cartilage as osteoarthritis (OA) progresses. The purpose of the present study was to investigate whether ursolic acid (UA) can protect chondrocytes and alleviate OA. Following stimulation with tumor necrosis factor-α (TNF-α), 5 μM UA displayed no cytotoxicity and reversed the up-regulation of the inflammatory factors MMP13, IL-1β, IL-6 and PTGS2, and down-regulation of the cartilaginous genes/proteins type II collagen and Aggrecan. RNA sequencing identified 533 common deferentially expressed genes (DEGs) of which TNF, PI3K-AKT, NOD-like receptor, cytokine receptor interaction and NF-κB pathways were of potential importance. Further notable DEGs in the most-highly expressed 10 pathways contributed to maintenance of cartilaginous ECM homeostasis and were involved in an inflammatory response. The expression of these most-enriched DEGs was reversed by UA following stimulation with TNF-α. Additional investigation demonstrated that treatment with UA inhibited TNF-α-induced nuclear translocation of p65 and phosphorylation of IκBα and AKT, and reversed TNF-α-induced up-regulation of P20, ACS and NLRP3. Furthermore, rat anterior cruciate ligament transection (ACLT) induced-OA was ameliorated by treatment with UA. In conclusion, these results suggest that UA activates chondrocytes through the NF-κB/NLRP3 inflammasome pathway, thus preventing cartilage degeneration in osteoarthritis.