Differences in cellular competence offer an explanation for the differences in the healing capacity of tissues of various ages and conditions. The homeobox family of genes plays key roles in governing cellular competence. Of these, we hypothesize that Msx2 is a strong candidate regulator of competence in skin wound healing because it is expressed in the skin during fetal development in the stage of scarless healing, affects postnatal digit regeneration, and is reexpressed transiently during postnatal skin wound repair. To address whether Msx2 affects cellular competence in injury repair, 3 mm full-thickness excisional wounds were created on the back of C.Cg-Msx2(tm1Rilm)/Mmcd (Msx2 null) mice and the healing pattern was compared with that of the wild type mice. The results show that Msx2 null mice exhibited faster wound closure with accelerated reepithelialization plus earlier appearance of keratin markers for differentiation and an increased level of smooth muscle actin and tenascin in the granulation tissue. In vitro, keratinocytes of Msx2 null mice exhibit increased cell migration and the fibroblasts show stronger collagen gel contraction. Thus, our results suggest that Msx2 regulates the cellular competence of keratinocytes and fibroblasts in skin injury repair.