While wound contraction plays an important role in healing, it may lead to excessive scar formation and pathological wound contracture in extreme conditions. To date, the key regulator of wound contraction and keloid formation is transforming growth factor-beta (TGF-b1). Decorin has been reported to bind TGF-b1 and neutralize some of its activities. The present study investigated whether decorin affected TGF-b1-induced fibroblast contractile activity by using fibroblast-populated collagen lattice (FPCL), which has been generally used as an in-vitro model thought to mimic wound contraction in vivo, modified by the incorporation of recombinant human decorin into collagen gel. As expected, TGF-b1 significantly enhanced the contraction of collagen gel at hour 12, 24, 48, 72, and 96 (P < 0.05). Recombinant human decorin inhibited both the basal and TGF-b1-enhanced contraction of collagen gel by keloid fibroblasts (P < 0.05). These inhibitory effects of recombinant human decorin were associated with suppression of TGF-b1-induced filamentous actin (F-actin) expression in keloid fibroblasts. Furthermore, recombinant human decorin inhibited TGF-b1 induced a-smooth muscle actin (a-SMA), PAI-1 (plasminogen activator inhibitor-1) protein, and mRNA expressions in keloid fibroblasts (P < 0.05). These data indicate that recombinant human decorin can suppress TGF-b1-induced contraction of collagen gel by keloid fibroblasts. Moreover, decorin can inhibit basal contraction of collagen gel by keloid fibroblasts. These results suggest that decorin may have therapeutic potential for excessive skin contraction as observed in a keloid.