Delayed wound healing caused by inefficient re-epithelialization underlines chronic skin lesions such as those found in diabetes. The dioxin receptor (AhR) modulates cell plasticity and migration and its activation by occupational polycyclic aromatic hydrocarbons (PAHs) results in severe skin lesions such as contact hypersensitivity, dermatitis and chloracne. Using wild-type (Ahr^+/+) and AhR-null (Ahr^–/–) mouse primary keratinocyte cultures and tissue explants, we show that lack of AhR increases keratinocyte migration and accelerates skin re-epithelialization without affecting cell proliferation or recruitment of inflammatory cells. Wounds in Ahr^–/– animals had elevated numbers of fibroblasts and increased collagen content in their granulation tissue. Importantly, Ahr^–/– dermal fibroblasts secreted higher levels of active TGFβ that increased keratinocyte migration in culture and that could account for over-activation of the TGFβ pathway and for faster wound healing in the AhR-null neo-epithelium. Consistently, a TGFβ neutralizing antibody decreased keratinocyte migration in culture and halted re-epithelialization in Ahr^–/– mice. Moreover, in vivo treatment with an antisense oligonucleotide for AhR increased TGFβ signaling and improved re-epithelialization in wounds of wild-type mice. These data indicate that AhR is relevant for wound repair and suggest that AhR downmodulation might be a potential new tool for the treatment of chronic, surgical or accidental wounds.