Parapoxviruses (PPV) cause skin and mucous membrane lesions in several animal species, and of the five recognized PPVs, at least three are zoonotic. Equine PPV (EqPPV) is the sixth one initially described in humans in the United States and later in a severely sick horse in Finland in 2013–2015. In 2021–2022, a large-scale pustulo-vesicular pastern dermatitis outbreak occurred in horses all over Finland. This study aimed at analysing the outbreak, identifying and describing the causative agent, describing clinical signs, and searching for risk factors. EqPPV was identified as a probable causative agent and co-infections with several potentially pathogenic and zoonotic bacteria were observed. Histopathologically, suppurative and ulcerative dermatitis was diagnosed. Due to the lack of specific tests for this virus, we developed a novel diagnostic EqPPV-PCR with sensitivity of 10 copies/reaction. Based on a large proportion of the genome sequenced directly from clinical samples, very little variation was detected between the sequences of the case from 2013 and the cases from 2021 to 2022. Based on an epidemiological survey, the main risk factor for pastern dermatitis was having racehorses. Approximately one third of the horses at each affected stable got clinical dermatitis, manifesting as severe skin lesions. Skin lesions were also occasionally reported in humans, indicating potential zoonotic transmission. Case stables commonly reported attendance at race events before acquiring the disease. Survey also identified differences in practises between case and control stables. Taken together, these results enable a better preparedness, diagnostics, and guidelines for future outbreaks.