Osteoarthritis (OA) is the most common age-related joint disease characterized by chronic inflammation, progressive articular cartilage destruction, and subchondral sclerosis. Accumulating evidence suggests that circular RNAs (circRNAs) play key roles in OA, but the function of circSLTM in OA remains greatly unknown. Therefore, this study focused on interleukin-1 beta (IL-1 beta)-treated primary human chondrocytes as well as a rat model to investigate the expression pattern and functional role of circSLTM in OA in vitro and in vivo. CircSLTM and high mobility group protein B2 (HMGB2) were upregulated in IL-1 beta-induced chondrocytes, whereas miR-421 was downregulated. Knockdown of circSLTM or overexpression of miR-421 ameliorated IL-1 beta-induced chondrocyte apoptosis and inflammation. The regulatory relationship between circSLTM and miR-421, as well as that between miR-421 and HMGB2, was predicted by bioinformatics and then verified by the RNA immunoprecipitation experiment and dual-luciferase reporter gene assay. Furthermore, silencing of circSLTM increased cartilage destruction and decreased cartilage tissue apoptosis rate and inflammation in a rat model of OA. Taken together, our findings demonstrate the fundamental role of circSLTM in OA progression and provide a potential molecular target for OA therapy.