Osteoarthritis (OA) is the most common degenerative joint disease; however, its etiopathogenesis is not completely understood. Here we show a role for NUDT7 in OA pathogenesis. Knockdown of NUDT7 in normal human chondrocytes results in the disruption of lipid homeostasis. Moreover, Nudt7 mice display significant accumulation of lipids via peroxisomal dysfunction, upregulation of IL-1β expression, and stimulation of apoptotic death of chondrocytes. Our genome-wide analysis reveals that NUDT7 knockout affects the glycolytic pathway, and we identify Pgam1 as a significantly altered gene. Consistent with the results obtained on the suppression of NUDT7, overexpression of PGAM1 in chondrocytes induces the accumulation of lipids, upregulation of IL-1β expression, and apoptotic cell death. Furthermore, these negative actions of PGAM1 in maintaining cartilage homeostasis are reversed by the co-introduction of NUDT7. Our results suggest that NUDT7 could be a potential therapeutic target for controlling cartilage-degrading disorders.