Muscle tissue is often removed during hamstring tendon graft preparation for anterior cruciate ligament (ACL) reconstruction. The purpose of the study was to test whether preservation of muscle remnants on a tendon graft is beneficial to the graft healing process following ACL reconstruction. Co-culturing of tendon-derived cells (TDCs) and muscle-derived cells (MDCs) was performed at various ratios, and their potential for cell viability and multilineage differentiation was compared to a single TDC cell group. Ligamentous and chondrogenic differentiation was most enhanced when a small population of MDCs was co-cultured with TDCs (6:2 co-culture group). Cell viability and osteogenic differentiation were proportionally enhanced with increasing MDC population size. MDCs co-cultured with TDCs possess both the ability to enhance cell viability and differentiate into other cell lineages.