Fabrication of anisotropic osteochondral-mimetic scaffold with mineralized subchondral zone and gradient interface remains challenging. We have developed an injectable semi-interpenetrating network hydrogel construct with chondroitin sulfate nanoparticles (ChS-NPs) and nanohydroxyapatite (nHA) (∼30–90 nm) in chondral and subchondral hydrogel zones respectively. Mineralized subchondral hydrogel exhibited significantly higher osteoblast proliferation and alkaline phosphatase activity (p < 0.05). Osteochondral hydrogel exhibited interconnected porous structure and spatial variation with gradient interface of nHA and ChS–NPs. Microcomputed tomography (μCT) demonstrated nHA gradation while rheology showed predominant elastic modulus (∼930 Pa) at the interface. Co–culture of osteoblasts and chondrocytes in gradient hydrogels showed layer–specific retention of cells and cell-cell interaction at the interface. In vivo osteochondral regeneration by biphasic (nHA or ChS) and gradient (nHA + ChS) hydrogels was compared with control using rabbit osteochondral defect after 3 and 8 weeks. Complete closure of defect was observed in gradient (8 weeks) while defect remained in other groups. Histology demonstrated collagen and glycosaminoglycan deposition in neo–matrix and presence of hyaline cartilage–characteristic matrix, chondrocytes and osteoblasts. μCT showed mineralized neo–tissue formation, which was confined within the defect with higher bone mineral density in gradient (chondral: 0.42 ± 0.07 g/cc, osteal: 0.64 ± 0.08 g/cc) group. Further, biomechanical push-out studies showed significantly higher load for gradient group (378 ± 56 N) compared to others. Thus, the developed nano-engineered gradient hydrogel enhanced hyaline cartilage regeneration with subchondral bone formation and lateral host-tissue integration.