Skin fibrosis, in its mildest form, may present only a minor aesthetic problem, but in the most severe cases it can lead to debilitating pathologies of the skin, for example keloid and hypertrophic scars, and systemic sclerosis. In recent years, extensive basic research aimed at understanding the molecular mechanisms underlying fibrosis has revealed an impressive but baffling number of genes, molecules, and cell types that may contribute to this problem. However, one recurring and consistent theme in these studies is that inflammatory cells and their secreted mediators appear to be leading culprits in activating dermal fibroblasts to become fibrotic. This review will first describe the histology of normal versus fibrotic skin, and will also describe the process of wound repair, a primary cause of skin fibrosis. We will then focus on what is currently known about the molecular mechanisms underlying skin fibrosis, with particular attention paid to how inflammation contributes. Finally, current treatment strategies and emerging therapeutic targets will be discussed.