The peritoneal membrane becomes damaged in patients on peritoneal dialysis (PD). Gremlin 1 (GREM1) inhibits bone morphogenic proteins (BMPs) and plays a role in kidney development and fibrosis. We evaluated the role of gremlin in peritoneal fibrosis and angiogenesis. In a cohort of 32 stable PD patients, GREM1 concentration in the peritoneal effluent correlated with measures of peritoneal membrane damage. AdGrem1, an adenovirus to overexpress gremlin in the mouse peritoneum, induced submesothelial thickening, fibrosis, and angiogenesis in C57BL/6 mice, which was associated with decreased expression of BMP4 and BMP7. There was evidence of mesothelial cell transition to a mesenchymal phenotype with increased α smooth muscle actin expression and suppression of E-cadherin. Some of the GREM1 effects may be reversed with recombinant BMP7 or a pan-specific transforming growth factor β (TGF-β) antibody. Neovascularization was not inhibited with a TGF-β antibody, suggesting a TGF-β-independent angiogenic mechanism. Swiss/Jackson Laboratory (SJL) mice, which are resistant to TGF-β-induced peritoneal fibrosis, responded in a similar fashion to AdGrem1 as did C57BL/6 mice with fibrosis, angiogenesis, and mesothelial-to-mesenchymal transition. GREM1 was associated with up-regulated TGF-β expression in both SJL and C57BL/6 mice, but SJL mice demonstrated a defective TGF-β-induced GREM1 expression. In summary, GREM1 induces fibrosis and angiogenesis in mouse peritoneum and is associated with increased solute transport in these PD patients.