Plasmacytoid dendritic cells (pDCs) are a rare population of circulating cells, which selectively express intracellular Toll-like receptors (TLR)-7 and TLR-9 and have the capacity to produce large amounts of type I IFNs (IFN-a/b) in response to viruses or host derived nucleic acid containing complexes. pDCs are normally absent in skin but accumulate in the skin of psoriasis patients where their chronic activation to produce IFN-a/b drives the disease formation. Whether pDCs and their activation to produce IFN-a/b play a functional role in healthy skin is unknown. Here we show that pDCs are rapidly and transiently recruited into healthy human and mouse skin upon epidermal injury. Infiltrating pDCs were found to sense nucleic acids in wounded skin via TLRs, leading to the production of IFN-a/b. The production of IFN-a/b was paralleled by a short lived expression of cathelicidins, which form complexes with extracellular nucleic acids and activated pDCs to produce IFN-a/b in vitro. In vivo, cathelicidins were sufficient but not necessary for the induction of IFN-a/b in wounded skin, suggesting redundancy of this pathway. Depletion of pDCs or inhibition of IFN-a/bR signaling significantly impaired the inflammatory response and delayed re-epithelialization of skin wounds. Thus we uncover a novel role of pDCs in sensing skin injury via TLR mediated recognition of nucleic acids and demonstrate their involvement in the early inflammatory process and wound healing response through the production of IFN-a/b.