The pleiotropic cytokines, transforming growth factor beta1 (TGFbeta1), and tumor necrosis factor (TNF) play critical roles in tissue homeostasis in response to injury and are implicated in multiple human diseases and cancer. We reported that the loss of Timp3 (tissue inhibitor of metalloproteinase 3) leads to abnormal TNF signaling and cardiovascular function. Here we show that parallel deregulation of TGFbeta1 and TNF signaling in Timp3(-/-) mice amplifies their cross-talk at the onset of cardiac response to mechanical stress (pressure overload), resulting in fibrosis and early heart failure. Microarray analysis showed a distinct gene expression profile in Timp3(-/-) hearts, highlighting activation of TGFbeta1 signaling as a potential mechanism underlying fibrosis. Neonatal cardiomyocyte-cardiofibroblast co-cultures were established to measure fibrogenic response to agonists known to be induced following mechanical stress in vivo. A stronger response occurred in neonatal Timp3(-/-) co-cultures, as determined by increased Smad signaling and collagen expression, due to increased TNF processing and precocious proteolytic maturation of TGFbeta1 to its active form. The relationship between TGFbeta1 and TNF was dissected using genetic and pharmacological manipulations. Timp3(-/-)/Tnf(-/-) mice had lower TGFbeta1 than Timp3(-/-), and anti-TGFbeta1 antibody (1D11) negated the abnormal TNF response, indicating their reciprocal stimulatory effects, with each manipulation abolishing fibrosis and improving heart function. Thus, TIMP3 is a common innate regulator of TGFbeta1 and TNF in tissue response to injury. The matrix-bound TIMP3 balances the anti-inflammatory and proinflammatory processes toward constructive tissue remodeling.