Altered serine protease activity is associated with skin disorders in humans and in mice. The serine protease channel-activating protease-1 (CAP1; also termed protease serine S1 family member 8 (Prss8)) is important for epidermal homeostasis and is thus indispensable for postnatal survival in mice, but its roles and effectors in skin pathology are poorly defined. In this paper, we report that transgenic expression in mouse skin of either CAP1/Prss8 (K14-CAP1/Prss8) or protease-activated receptor-2 (PAR2; Grhl3(PAR2/+)), one candidate downstream target, causes epidermal hyperplasia, ichthyosis and itching. K14-CAP1/Prss8 ectopic expression impairs epidermal barrier function and causes skin inflammation characterized by an increase in thymic stromal lymphopoietin levels and immune cell infiltrations. Strikingly, both gross and functional K14-CAP1/Prss8-induced phenotypes are completely negated when superimposed on a PAR2-null background, establishing PAR2 as a pivotal mediator of pathogenesis. Our data provide genetic evidence for PAR2 as a downstream effector of CAP1/Prss8 in a signalling cascade that may provide novel therapeutic targets for ichthyoses, pruritus and inflammatory skin diseases.