Background: Atopic dermatitis (AD) is characterized by intense pruritis and is a common childhood inflammatory disease. Many factors are known to affect AD development, including the pleiotropic cytokine IL-4. Yet little is known regarding the direct effects of IL-4 on keratinocyte function. Objective and Methods: In this report RNA sequencing and functional assays were used to define the effect of the allergic environment on primary keratinocyte function and wound repair in mice. Results: Acute or chronic stimulation by IL-4 modified expression of more than 1000 genes expressed in human keratinocytes that are involved in a broad spectrum of nonoverlapping functions. Among the IL-4-induced changes, repression of fibronectin critically impaired the human keratinocyte wound response. Moreover, in mouse models of spontaneous and induced AD-like lesions, there was delayed re-epithelialization. Importantly, topical treatment with fibronectin restored the epidermal repair response. Conclusion: Keratinocyte gene expression is critically shaped by IL-4, altering cell fate decisions, which are likely important for the clinical manifestations and pathology of allergic skin disease.