To understand the molecular pathogenesis of oral submucous fibrosis (OSF), which is a chronic inflammatory disease, gene expression profiling was performed in 10 OSF tissues against 8 pooled normal tissues using oligonucleotide arrays. Microarray results revealed differential expression of 5,288 genes (P ≤ 0.05 and fold change ≥ 1.5). Among these, 2,884 are upregulated and 2,404 are downregulated. Validation employing quantitative real-time PCR and immunohistochemistry confirmed upregulation of transforming growth factor-β1 (TGF-β1), TGFBIp, THBS1, SPP1, and TIG1 and downregulation of bone morphogenic protein 7 (BMP7) in OSF tissues. Furthermore, activation of TGF-β pathway was evident in OSF as demonstrated by pSMAD2 strong immunoreactivity. Treatment of keratinocytes and oral fibroblasts by TGF-β confirmed the regulation of few genes identified in microarray including upregulation of connective tissue growth factor, TGM2, THBS1, and downregulation of BMP7, which is a known negative modulator of fibrosis. Taken together, these data suggest activation of TGF-β signaling and suppression of BMP7 expression in the manifestation of OSF.