Human fetal progenitor tenocytes (hFPT) produced in defined cell bank systems have recently been characterized and qualified as potential therapeutic cell sources in tendon regenerative medicine. In view of further optimizing the manufacture of the cell-based active substance, the effects of hypoxic (i.e., 2% O2 partial pressure) in vitro culture expansion on key cellular characteristics or process parameters were evaluated. To this end, multiple aspects were comparatively assessed, in either normoxic incubation (i.e., 5% CO2 and 21% O2, standard conditions) or in hypoxic incubation (i.e., 5% CO2 and 2% O2, optimized conditions). Experimentally investigated parameters and endpoints comprised cellular proliferation, cellular morphology and size distribution, cell surface marker panels, cell susceptibility toward adipogenic and osteogenic induction, while relative protein expression levels were analyzed by quantitative mass spectrometry. Results outlined conserved basic cellular characteristics (i.e., surface marker panels, phenotype under chemical induction) as well as modified key cellular parameters (i.e., cell size distribution, endpoint cell yields, matrix protein contents) potentially procuring tangible benefits with regard to an optimized cell manufacturing workflow. Specific proteomic analyses further shed some light on the effects of hypoxia at a protein level, potentially orienting the further processing of hFPT for cell-free active substance manufacture. Overall, this study indicated that hypoxic incubation impacts specific hFPT key properties and enables optimized manufacture of tenocyte-based active substances in homologous standardized transplant products.