Dysregulated inflammatory responses are known to impair wound healing in diabetes, but the underlying mechanisms are poorly understood. Here we show that the antimicrobial protein REG3A controls TLR3-mediated inflammation after skin injury. This control is mediated by REG3A-induced SHP-1 protein, and acts selectively on TLR3-activated JNK2. In diabetic mouse skin, hyperglycaemia inhibits the expression of IL-17-induced IL-33 via glucose glycation. The decrease in cutaneous IL-33 reduces REG3A expression in epidermal keratinocytes. The reduction in REG3A is associated with lower levels of SHP-1, which normally inhibits TLR3-induced JNK2 phosphorylation, thereby increasing inflammation in skin wounds. To our knowledge, these findings show for the first time that REG3A can modulate specific cutaneous inflammatory responses and that the decrease in cutaneous REG3A exacerbates inflammation in diabetic skin wounds.