The skin is essential for terrestrial life. It is responsible for regulating water permeability and functions as a mechanical barrier that protects against environmental insults such as microbial infection, ultraviolet light, injury, and heat and cold, which could damage the cells of the body and compromise survival of the organism. This barrier is provided by the outer layer, the epidermis, which is composed predominantly of keratinocytes; keratinocytes undergo a program of differentiation to form the stratum corneum comprising the cornified squame "bricks" and lipid "mortar." Dys-regulation of this differentiation program can result in skin diseases, including psoriasis and nonmelanoma skin cancers, among others. Accumulating evidence in the literature indicates that the water-, glycerol-, and hydrogen peroxide-transporting channel aquaporin-3 (AQP3) plays a key role in various processes involved in keratinocyte function, and abnormalities in this channel have been observed in several human skin diseases. Here, we discuss the data linking AQP3 to keratinocyte proliferation, migration, differentiation, and survival as well as its role in skin properties and functions like hydration, water retention, wound healing, and barrier repair. We also discuss the mechanisms regulating AQP3 levels, localization, and function and the anomalies in AQP3 that are associated with various skin diseases.