The severe pediatric disorder mucolipidosis II (ML-II; also known as I-cell disease) is caused by defects in mannose 6-phosphate (Man-6-P) biosynthesis. Patients with ML-II exhibit multiple developmental defects, including skeletal, craniofacial and joint abnormalities. To date, the molecular mechanisms that underlie these clinical manifestations are poorly understood. Taking advantage of a zebrafish model of ML-II, we previously showed that the cartilage morphogenesis defects in this model are associated with altered chondrocyte differentiation and excessive deposition of type II collagen, indicating that aspects of development that rely on proper extracellular matrix homeostasis are sensitive to decreases in Man-6-P biosynthesis. To further investigate the molecular bases for the cartilage phenotypes, we analyzed the transcript abundance of several genes in chondrocyte-enriched cell populations isolated from wild-type and ML-II zebrafish embryos. Increased levels of cathepsin and matrix metalloproteinase (MMP) transcripts were noted in ML-II cell populations. This increase in transcript abundance corresponded with elevated and sustained activity of several cathepsins (K, L and S) and MMP-13 during early development. Unlike MMP-13, for which higher levels of protein were detected, the sustained activity of cathepsin K at later stages seemed to result from its abnormal processing and activation. Inhibition of cathepsin K activity by pharmacological or genetic means not only reduced the activity of this enzyme but led to a broad reduction in additional protease activity, significant correction of the cartilage morphogenesis phenotype and reduced type II collagen staining in ML-II embryos. Our findings suggest a central role for excessive cathepsin K activity in the developmental aspects of ML-II cartilage pathogenesis and highlight the utility of the zebrafish system to address the biochemical underpinnings of metabolic disease.