Augmented Wnt signaling has been implicated in many fibrotic diseases including obstructive nephropathy. Soluble form Klotho has been reported to function as a secreted Wnt antagonist. In this study, we tested whether Klotho protein could reduce renal fibrosis by inhibition of Wnt signaling. Transgenic mice that overexpressed Klotho, wild-type mice, and Klotho hetero mutant mice underwent unilateral ureteral obstruction (UUO). In some Klotho hetero mutant mice, Klotho-encoding plasmid was transferred into the skeletal muscle by electroporation. UUO induced activation of Wnt signaling in wild-type but less in Klotho transgenic mice. Enhanced tubulointerstitial fibrosis in wild-type mice was also attenuated in Klotho transgenic mice. In contrast, Wnt signaling and concomitant tubulointerstitial fibrosis were further augmented in Klotho hetero mutant mice after UUO compared with wild-type mice. In Klotho-encoding plasmid-transfected Klotho hetero mutant mice, however, Wnt signaling was markedly reduced accompanied by a decrease in extracellular matrix deposition after UUO. In vitro studies showed that stimulation of Wnt3a induced prolonged cell cycle arrest at G₂/M phase, with a resultant increase in production of fibrogenic cytokines. Cotreatment with Klotho bypassed the G₂/M arrest and reduced fibrogenic cytokine production. In conclusion, Klotho is a critical negative regulator of Wnt signaling and a suppressor of renal fibrosis in the obstructed kidney model.