Connective tissue growth factor (CTGF) plays an important role in the pathogenesis of chronic fibrotic diseases. However, the mechanism by which paracrine effects of CTGF control the cell fate of neighboring epithelial cells is not known. In this study, we investigated the paracrine effects of CTGF overexpressed in fibroblasts of Col1a2-CTGF transgenic mice on epithelial cells of skin and lung. The skin and lungs of Col1a2-CTGF transgenic mice were examined for phenotypic markers of epithelial activation and differentiation and stimulation of signal transduction pathways. In addition to an expansion of the dermal compartment in Col1a2-CTGF transgenic mice, the epidermis was characterized by focal hyperplasia and basal cells stained positive for αSMA, Snail, S100A4 and Sox9, indicating that these cells had undergone a change in their genetic program. Activation of p-p38 and pErk1/2 was observed in the granular and cornified layers of the skin. Lung fibrosis was associated with a marked increase in cells co-expressing epithelial and mesenchymal markers in the lesional and unaffected lung tissue of Col1a2-CTGF mice. In epithelial cells treated with TGFβ, CTGF-specific siRNA-mediated knockdown suppressed Snail, Sox9, S100A4 protein levels and restored E-cadherin levels. Both adenoviral expression of CTGF in epithelial cells and treatment with recombinant CTGF induced EMT-like morphological changes and expression of α-SMA. Our in vivo and in vitro data supports the notion that CTGF expression in mesenchymal cells in the skin and lungs can cause changes in the differentiation program of adjacent epithelial cells. We speculate that these changes might contribute to fibrogenesis.