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Fibrosis is associated with a variety of skin diseases and causes severe aesthetic and functional impairments. Functional studies in rodents, together with clinical observations, strongly suggest a crucial role of chronic injury and inflammation in the pathogenesis of fibrotic diseases. The phenotype of mice lacking fibroblast growth factor (FGF) receptors 1 and 2 in keratinocytes supports this concept. In these mice, a defect in keratinocytes alone initiated an inflammatory response, which in turn caused keratinocyte hyperproliferation and dermal fibrosis. As the mechanism underlying this phenotype, we identified a loss of FGF-induced expression of claudins and occludin, which caused abnormalities in tight junctions with concomitant deficits in epidermal barrier function. This resulted in severe transepidermal water loss and skin dryness. In turn, activation of keratinocytes and epidermal γδ T cells occurred, which produced IL-1 family member 8 and S100A8 and S100A9. These cytokines attracted immune cells and activated fibroblasts, resulting in a double paracrine loop through production of keratinocyte mitogens by dermal cells. In addition, a profibrotic response was induced in fibroblasts. Our results highlight the importance of an intact epidermal barrier for the prevention of inflammation and fibrosis and the role of chronic inflammation in the pathogenesis of fibrotic diseases.