Matrix metalloproteinase (MMP) inhibitors, candidate therapeutic agents for a number of diseases, are known to be associated with acute fibrosis-type adverse effects in a number of species, including humans. The broad-spectrum MMP inhibitor, AZM551248, has previously been shown to cause these effects in the dog. Changes were characterized by the abnormal and extensive proliferation of fibroblasts and the deposition of collagen particularly in the subcutaneous connective tissues (subcutis) and were termed fibrodysplasia (FD). We performed a time-course study in dogs using AZM551248 and sampled skin, subcutis, and plasma before and during the development of FD. Detailed histopathological analysis and global gene expression profiling were performed on the subcutaneous tissues. The gene expression analysis of the subcutis indicated that extracellular matrix (ECM) remodeling was initiated asymptomatically at or before the earliest time point, day 4, and this was associated with dysregulation of expression of a number of MMPs and proteolytic enzymes. At later time points, the FD became progressively more extensive and severe, and this was associated with gene expression changes characteristic of tissue fibrosis, for example those associated with procollagen synthesis and processing. We postulate that AZM551248 inhibition of MMP action within the subcutis modulates the activity of several transcription factors and this in turn upregulates expression of specific proteases which initiate ECM remodeling. Persistent MMP inhibition results in the progression of ECM remodeling, culminating in collagen deposition and overt fibrosis. Our data indicate that inhibition of MMPs 1, 2, 3, and 9 is a key early event in AZM551248-induced FD in dog subcutis.