Mg ions can enhance the proliferation and redifferentiation of chondrocytes and the osteogenic differentiation of osteoblasts at specific concentrations, respectively. However, degradation of Mg alloys at varying degradation rates could lead to complex changes in the surrounding tissue environment, such as changes in the dynamic concentration of Mg ions and subsequent pH value. Considering the above mentioned factors, the comprehensive effects of Mg alloys on chondrocytes and osteoblasts behaviors have not yet been optimized. In this study, we evaluated the effects of Mg–1Ca microspheres on cell behavior with an aim to optimize conditions favorable for both cell types. Cells were cultured with Mg–1Ca microspheres prepared using the following concentrations: 250 μg/ml, 500 μg/ml and 1000 μg/ml. At specific time points, cytotoxicity, expression of specific genes and extracellular matrix deposition by cells (Alizarin Red Staining of osteoblasts and Alcian blue staining for chondrocytes) were evaluated. The experimental results revealed that Mg–1Ca microspheres prepared at a concentration of 250 μg/ml were optimum for both cell types, where chondrocytes were found to be in hypertrophy state while osteoblasts in close proximity to the microspheres showed osteogenetic differentiation. Interestingly, a slight change in osteoblasts behavior was observed nearer to and at a relative distance away from Mg–1Ca microspheres, an important observation for administering the application of microspheres as potential scaffolds.