Degeneration is a hallmark of painful joint disease and is mediated by many proteases that degrade joint tissues, including collagenases. We hypothesized that purified bacterial collagenase would initiate nociceptive cascades in the joint by degrading the capsular ligament's matrix and activating innervating pain fibers. Intra-articular collagenase in the rat facet joint was investigated for its effects on behavioral sensitivity, joint degeneration, and nociceptive pathways in the peripheral and central nervous systems. In parallel, a co-culture collagen gel model of the ligament was used to evaluate effects of collagenase on microscale changes to the collagen fibers and embedded neurons. Collagenase induced sensitivity within one day, lasting for 3 weeks (p < 0.001) but did not alter ligament structure, cartilage health, or chondrocyte homeostasis. Yet, nociceptive mediators were increased in the periphery (substance P, pERK, and MMP-1; p ≤ 0.039) and spinal cord (substance P and MMP-1; p ≤ 0.041). The collagen loss (p = 0.008) induced by exposing co-cultures to collagenase was accompanied by altered neuronal activity (p = 0.002) and elevated neuronal MMP-1 (p < 0.001), suggesting microscale collagen degradation mediates sensitivity in vivo. The induction of sustained sensitivity and nociception without joint damage may explain the clinical disconnect in which symptomatic joint pain patients present without radiographic evidence of joint destruction.