Tissue fibrosis, the excessive deposition of collagen/extracellular matrix combined with the reduction of the cell compartment, defines fibroproliferative diseases, a major cause of death and a public health burden. Key cellular processes in fibrosis include the generation of myofibroblasts from progenitor cells, and the activation or switch of already differentiated cells to a fibrotic synthetic phenotype. Myostatin, a negative regulator of skeletal muscle mass, is postulated to be involved in muscle fibrosis. We have examined whether myostatin affects the differentiation of a multipotent mesenchymal mouse cell line into myofibroblasts, and/or modulates the fibrotic phenotype and Smad expression of the cell population. In addition, we investigated the role of follistatin in this process. Incubation of cells with recombinant myostatin protein did not affect the proportion of myofibroblasts in the culture, but significantly upregulated the expression of fibrotic markers such as collagen and the key profibrotic factors transforming growth factor-β1 (TGF-β1) and plasminogen activator inhibitor (PAI-1), as well as Smad3 and 4, and the pSmad2/3. An antifibrotic process evidenced by the upregulation of follistatin, Smad7, and matrix metalloproteinase 8 accompanied these changes. Follistatin inhibited TGF-β1 induction by myostatin. Transfection with a cDNA expressing myostatin upregulated PAI-1, whereas an shRNA against myostatin blocked this effect. In conclusion, myostatin induced a fibrotic phenotype without significantly affecting differentiation into myofibroblasts. The concurrent endogenous antifibrotic reaction confirms the view that phenotypic switches in multipotent and differentiated cells may affect the progress or reversion of fibrosis, and that myostatin pharmacological inactivation may be a novel therapeutic target against fibrosis.