Across vertebrates, there are three principal skeletal tissues: bone, persistent cartilage, and replacement cartilage. Although each tissue has a different evolutionary history and functional morphology, they also share many features. For example, they function as structural supports, they are comprised of cells embedded in collagen-rich extracellular matrix, and they derive from a common embryonic stem cell, the osteochondroprogenitor. Occasionally, homologous skeletal elements can change tissue type through phylogeny. Together, these observations raise the possibility that skeletal tissue identity is determined by a shared set of genes. Here, we show that misexpression of either Sox9 or Runx2 can substitute bone with replacement cartilage or can convert persistent cartilage into replacement cartilage and vice versa. Our data also suggest that these transcription factors function in a molecular hierarchy in which chondrogenic factors dominate. We propose a binary molecular code that determines whether skeletal tissues form as bone, persistent cartilage, or replacement cartilage. Finally, these data provide insights into the roles that master regulatory genes play during evolutionary change of the vertebrate skeleton.