CD44 family members are cell surface glycoproteins, which are expressed on tubular epithelial cells (TEC) solely upon kidney injury and are involved in renal fibrosis development. Renal interstitial fibrosis is the final manifestation of chronic kidney diseases and is regulated by a complex network of cytokines, including the pro-fibrotic factor TGF-β1 and the two anti-fibrotic cytokines BMP-7 and HGF. The present study investigates the potential role of CD44 standard (CD44s) and CD44v3-v10 (CD44v3) isoforms as modulators of the balance between TGF-β1 and HGF/BMP-7. CD44s is the shortest and most common isoform. CD44v3-v10 (CD44v3) has heparan sulfate moieties, which enable the binding to HGF/BMP-7, and hence, might exert reno-protective effects. Using transgenic mice overexpressing either CD44s or CD44v3 specifically on proximal TEC, we found that in vitro the overexpression of CD44v3 on primary TEC renders cells less susceptible to TGF-β1 pro-fibrotic actions and more sensitive to BMP-7 and HGF in comparison to TEC overexpressing CD44s. One day after unilateral ureteric obstruction, obstructed kidneys from CD44v3 transgenic mice showed less tubular damage and myofibroblasts accumulation, which was associated with decreased TGF-β1 signaling and increased BMP-7 synthesis and signaling compared to kidneys from WT and CD44s transgenic mice. These data suggest that CD44v3 plays a renoprotective role in early stage of chronic obstructive nephropathy.