Environmental challenges to epithelial cells trigger gene expression changes that elicit context-appropriate immune responses. We found that the chromatin remodeler Mi-2β controls epidermal homeostasis by regulating the genes involved in keratinocyte and immune-cell activation to maintain an inactive state. Mi-2β depletion resulted in rapid deployment of both a pro-inflammatory and an immunosuppressive response in the skin. A key target of Mi-2β in keratinocytes is the pro-inflammatory cytokine thymic stromal lymphopoietin (TSLP). Loss of TSLP receptor (TSLPR) signaling specifically in regulatory T (Treg) cells prevented their activation and permitted rapid progression from a skin pro-inflammatory response to a lethal systemic condition. Thus, in addition to their well-characterized role in pro-inflammatory responses, keratinocytes also directly support immune-suppressive responses that are critical for re-establishing organismal homeostasis.