Fibroblast growth factors (FGFs) are master regulators of organogenesis and tissue homeostasis. In this study, we used different combinations of FGF receptor (FGFR)-deficient mice to unravel their functions in the skin. Loss of the IIIb splice variants of FGFR1 and FGFR2 in keratinocytes caused progressive loss of skin appendages, cutaneous inflammation, keratinocyte hyperproliferation, and acanthosis. We identified loss of FGF-induced expression of tight junction components with subsequent deficits in epidermal barrier function as the mechanism underlying the progressive inflammatory skin disease. The defective barrier causes activation of keratinocytes and epidermal γδ T cells, which produce interleukin-1 family member 8 and S100A8/A9 proteins. These cytokines initiate an inflammatory response and induce a double paracrine loop through production of keratinocyte mitogens by dermal cells. Our results identify essential roles for FGFs in the regulation of the epidermal barrier and in the prevention of cutaneous inflammation, and highlight the importance of stromal–epithelial interactions in skin homeostasis and disease.