CD248 (endosialin) belongs to a glycoprotein family that also includes thrombomodulin (CD141), CLEC14A, and CD93 (AA4) stem cell markers. We analyzed the regulated expression of CD248 in vitro using skin (HFFF) and synovial (FLS) mesenchymal stem cell lines, and in fluid and tissue samples of rheumatoid arthritis (RA) and osteoarthritis (OA) patients. Cells were incubated with either rhVEGF165, bFGF, TGF-β1, IL1-β, TNF-α, TGFβ1, IFN-γ, or PMA (Phorbol ester). There was no statistically significant change in membrane expression. A soluble (s) form of cleaved CD248 (sCD248) was detected after cell treatment with IL1-β and PMA. Matrix metalloprotease (MMP) MMP-1 and MMP-3 mRNAs were significantly up-regulated by IL1-β and PMA. A broad MMP inhibitor blocked the release of soluble CD248. In RA synovial tissue, we identified CD90+perivascular MSCs double-stained for CD248 and VEGF. High sCD248 levels were detected in synovial fluid from RA. In culture, subpopulations of CD90+CD14−RA MSCs were either identified as CD248+or CD141+cells but CD93−. CD248 is abundantly expressed by inflammatory MSCs and shed in an MMP-dependent manner in response to cytokines and pro-angiogenic growth factors. Both membrane-bound and soluble CD248 (acting as a decoy receptor) may contribute to RA pathogenesis.