Transcription factor SOX9 (sex‐determining region Y‐type high mobility group box 9) and its coactivators SOX5 and SOX6 (the SOX trio) induce early‐stage chondrocyte differentiation and suppress its terminal stage. To identify possible targets of the SOX trio, we carried out a microarray analysis and identified S100A1 and S100B as possible target molecules. S100 protein expression was localized in late proliferative and pre‐hypertrophic chondrocytes of the mouse growth plate. Overexpression of S100A1, S100B or their combination in cultured chondrogenic cells did not induce early differentiation, but suppressed hypertrophic differentiation and mineralization. Silencing of both S100A1 and S100B stimulated terminal differentiation and reversed the SOX‐trio‐mediated inhibition. Finally, luciferase reporter, electrophoretic mobility shift and chromatin immunoprecipitation analyses showed that transcription of both S100 proteins is induced by the SOX trio, and also identified their respective enhancer elements in the 5′‐end flanking region. We conclude that S100A1 and S100B are transcriptional targets of the SOX trio and mediate its inhibition of terminal differentiation of chondrocytes.