Proteolytic activities in the extracellular matrix by the matrix metalloproteinase (MMP)-14 have been implicated in the remodeling of collagenous proteins during development. To analyze the function of fibroblast-derived MMP-14 in adult skin homeostasis, we generated mice with inducible deletion of MMP-14 in the dermal fibroblast (MMP-14Sf–/–). These mice are smaller and display a fibrosis-like phenotype in the skin. The skin of these mice showed increased stiffness and tensile strength but no altered collagen cross-links. In vivo, we measured a significantly increased amount of collagen type I accumulated in the skin of MMP-14Sf–/– mice without an increase in collagen fibril diameters. However, bleomycin-induced fibrosis in skin proceeded in a comparable manner in MMP-14Sf+/+ and MMP-14Sf–/– mice, but resolution over time was impaired in MMP-14Sf–/– mice. Increased accumulation of collagen type I was detected in MMP-14Sf–/– fibroblasts in culture without significant enhancement of collagen de novo synthesis. This points to a degradative but not synthetic phenotype. In support of this, MMP-14Sf–/– fibroblasts lost their ability to process fibrillar collagen type I and to activate proMMP-2. Taken together, these data indicate that MMP-14 expression in fibroblasts plays a crucial role in collagen remodeling in adult skin and largely contributes to dermal homeostasis underlying its pathogenic role in fibrotic skin disease.