Blockade of transforming growth factor-beta (TGF-beta) signaling by Smad7 gene therapy is known to prevent experimental renal fibrosis. This study investigated whether Smad7 suppresses renal fibrosis via altering the renal expression of fibrosis-related microRNAs. Application of gene therapy into diseased kidneys of obstructive nephropathy and kidney cells by overexpressing Smad7 restored miR-29b but inhibited the expression of miR-192 and miR-21, resulting in blockade of renal fibrosis. Furthermore, Smad7 overexpression also suppressed advanced glycated end products- and angiotensin II-regulated expression of these microRNAs. In contrast, disruption of Smad7 gene in mice demonstrated opposite results by enhancing the loss of miR-29b and upregulation of miR-192 and miR-21, resulting in promotion of renal fibrosis in ligated kidneys of a model of obstructive nephropathy. More importantly, treatment with anti-miR-29b, miR-21 and miR-192 mimics in Smad7 overexpressing tubular epithelial cells abrogated the suppressive function of Smad7 on renal fibrosis, suggesting that these microRNAs act downstream of Smad7 to override the Smad7 function. In conclusion, Smad7 protects kidneys from fibrosis by regulating TGF-beta/Smad3-mediated renal expression of miR-21, miR-192, and miR-29b. Restored renal miR-29b but suppressed miR-192 and miR-21 may be a mechanism by which gene therapy with Smad7 inhibits renal fibrosis.