The aim of this study is to determine, in the framework of a randomized controlled clinical trial, whether Tai Chi can affect measurable improvements in self-reported outcomes such as pain, physical function and psychological well-being in people with osteoarthritis (OA) mainly affecting the hips or knees. The effectiveness of Tai Chi will be compared with both a non-intervention control group as well as with a formal exercise program, hydrotherapy. Hydrotherapy has long been considered an effective intervention for people with chronic OA although scientific evidence is weak at present. The main study hypotheses are that Tai Chi or hydrotherapy can significantly decrease pain and physical limitations; improve health-related quality of life; and promote psychological well being in patients with OA of the hip(s) or knee(s); and that Tai Chi and hydrotherapy are of equal efficacy.