The transcription factor Nrf2 is a key regulator of the cellular stress response, and pharmacological Nrf2 activation is a promising strategy for skin protection and cancer prevention. We show here that prolonged Nrf2 activation in keratinocytes causes sebaceous gland enlargement and seborrhea in mice due to upregulation of the growth factor epigen, which we identified as a novel Nrf2 target. This was accompanied by thickening and hyperkeratosis of hair follicle infundibula. These abnormalities caused dilatation of infundibula, hair loss, and cyst development upon aging. Upregulation of epigen, secretory leukocyte peptidase inhibitor (Slpi), and small proline-rich protein 2d (Sprr2d) in hair follicles was identified as the likely cause of infundibular acanthosis, hyperkeratosis, and cyst formation. These alterations were highly reminiscent to the phenotype of chloracne/"metabolizing acquired dioxin-induced skin hamartomas" (MADISH) patients. Indeed, SLPI, SPRR2, and epigen were strongly expressed in cysts of MADISH patients and upregulated by dioxin in human keratinocytes in an NRF2-dependent manner. These results identify novel Nrf2 activities in the pilosebaceous unit and point to a role of NRF2 in MADISH pathogenesis.