Fibroblast growth factor-binding protein 1 (FGFBP1, FGF-BP) is a secreted chaperone that mobilizes paracrine-acting FGFs, stored in the extracellular matrix, and presents them to their cognate receptors. FGFBP1 enhances FGF signaling including angiogenesis during cancer progression, and is upregulated in various cancers. Here we evaluated the contribution of endogenous FGFBP1 to development and homeostasis as well as to skin pathologies utilizing Fgfbp1-knockout (KO) mice. Relative to wild-type (WT) littermates KO mice showed no gross pathologies. Still, in KO mice a significant thickening of the epidermis associated with a decreased transepidermal water loss and increased pro-inflammatory gene expression in the skin was detected. Also, skin carcinogen challenge by DMBA/TPA resulted in delayed and reduced papillomatosis in KO mice. This was paralleled by delayed healing of skin wounds and reduced angiogenic sprouting in subcutaneous matrigel plugs. Heterozygous GFP-knock-in mice revealed rapid induction of gene expression during papilloma induction and during wound healing. Examination of WT skin grafted onto Fgfbp1 GFP knockin reporter hosts and bone marrow transplants from the GFP reporter model into WT hosts revealed that circulating Fgfbp1-expressing cells migrate into healing wounds. We conclude that tissue-resident and circulating Fgfbp1-expressing cells modulate skin carcinogenesis and inflammation.