The discovery of induced pluripotent stem cells (iPSCs) rendered the reprogramming of terminally differentiated cells to primary stem cells with pluripotency possible and provided potential for the regeneration and restoration of cartilage defect. Chondrogenic differentiation of iPSCs is crucial for their application in cartilage tissue engineering. In this study we investigated the effect of 3D nanofibrous scaffolds on the chondrogenesis of iPSCs and articular cartilage defect restoration. Super-hydrophilic and durable mechanic polycaprolactone (PCL)/gelatin scaffolds were fabricated using two separate electrospinning processes. The morphological structure and mechanical properties of the scaffolds were characterized. The chondrogenesis of the iPSCs in vitro and the restoration of the cartilage defect was investigated using scanning electron microscopy (SEM), the Cell Counting Kit-8 (CCK-8), histological observation, RT-qPCR, and western blot analysis. iPSCs on the scaffolds expressed higher levels of chondrogenic markers than the control group. In an animal model, cartilage defects implanted with the scaffold-cell complex exhibited an enhanced gross appearance and histological improvements, higher cartilage-specific gene expression and protein levels, as well as subchondral bone regeneration. Therefore, we showed scaffolds with a 3D nanofibrous structure enhanced the chondrogenesis of iPSCs and that iPSC-containing scaffolds improved the restoration of cartilage defects to a greater degree than did scaffolds alone in vivo.