The expression and distribution of keratinocyte growth factor (KGF), fibroblast growth factor-7 (FGF-7), and its receptor, keratinocyte growth factor receptor (KGFR), during reepithelialization of human skin was investigated. KGF mRNA levels increased 8- to 10-fold in tissue samples from the wounded area at one to three days and remained elevated, although to a lesser extent, by nine days. There was a correlated increase in KGF protein expression detected by ELISA. In the same tissue samples, the KGFR transcript showed decreased expression early, but was found elevated by eight to nine days. KGFRs were immunohistochemically localized to differentiating keratinocytes of the suprabasal layer of the epidermis. This temporal modulation of KGF and KGFR, in conjunction with the detection of KGFR in differentiating keratinocytes, might indicate a functional involvement of KGF in regulating human keratinocyte differentiation during reepithelialization of the skin. Steroidal anti- inflammatory agents, specifically glucocorticoids, markedly impair wound healing. The participation of KGF in wound healing led us to examine the effect of glucocorticoids on KGF production. Addition of dexamethasone significantly reduced the level of constitutively produced KGF mRNA, protein and bioactivity in conditioned medium from dermal fibroblasts. This inhibitory effect was observed with a variety of glucocorticoids, while non-steroidal anti-inflammatory compounds had little effect on KGF synthesis. The mechanism by which dexamethasone decreased KGF production includes a combination of diminished transcriptional rate and destabilization of the KGF mRNA. Cytokines such as interleukin-1a (IL- 1a), platelet-derived growth factor-BB (PDGF-BB) and transforming growth factor-a (TGFa), typically upregulated during wound healing, augment KGF expression by dermal fibroblasts. It was determined that dexamethasone also blocked this inductive effect. These results suggest that glucocorticoids could inhibit KGF production in the setting of wound repair, which may contribute to the impairment of healing associated with glucocorticoid use.