The pathogenesis of systemic sclerosis (SSc) is not fully understood and there is no effective treatment for this disease. Retinoic acid (RA) can modulate connective tissue metabolism, exhibit anti-fibrotic activity, and improve the clinical symptoms of SSc. However, the mechanisms by which RA elicits its anti-fibrotic actions remain to be determined. The aim of this study was to elucidate the underlying mechanisms by which RA exerts beneficial effects on scleroderma. Cultured skin fibroblasts from patients with scleroderma were treated with RA and their effect on the expression of 5-lipoxygenase (LOX), transforming growth factor (TGF)-β1, connective tissue growth factor (CTGF), type I and type III collagen was tested by reverse transcription polymerase chain reaction (RT–PCR) and western immunoblotting. The effect of MK886, a 5-LOX-specific inhibitor, on the expression of TGF-β1, CTGF, type I and type III collagen was also examined by RT–PCR. In cultured scleroderma fibroblasts, the expression of 5-LOX was elevated compared with normal human dermal fibroblasts. RA significantly inhibited the expression of 5-LOX and of TGF-β1, CTGF, type I and type III collagen. We further found that the expression of TGF-β1, CTGF and type I and type III collagen mRNA was inhibited by MK886 in scleroderma fibroblasts. In vitro, RA reduced 5-LOX expression in scleroderma fibroblasts and downregulated TGF-β1 and CTGF expression, leading to the inhibition of type I and type III collagen synthesis. Our results indicate that the clinical effects of RA on scleroderma are, at least in part, attributable to the reduction of 5-LOX expression and the subsequent suppression of TGF-β1 and CTGF expression that results in the blockade of collagenogenesis.