Fibrosis is a pathological process characterized by excessive accumulation of connective tissue components in an organ or tissue. Fibrosis is produced by deregulated wound healing in response to chronic tissue injury or chronic inflammation, the hallmarks of rheumatic diseases. Progressive fibrosis, which distorts tissue architecture and results in progressive loss of organ function, is now recognized to be one of the major causes of morbidity and mortality in individuals with one of the most lethal rheumatic disease, systemic sclerosis (SSc). In this Review, we discuss the pathological role of fibrosis in SSc. We discuss the involvement of endothelium and pericyte activation, aberrant immune responses, endoplasmic reticulum stress and chronic tissue injury in the initiation of fibrosis in SSc. We then discuss fibroblast activation and myofibroblast differentiation that occurs in response to these initiating processes and is responsible for excessive accumulation of extracellular matrix. Finally, we discuss the chemical and mechanical signals that drive fibroblast activation and myofibroblast differentiation, which could serve as targets for new therapies for fibrosis in SSc.