Wound healing in diabetic skin is impaired by excessive activation of matrix metalloproteinase-9 (MMP-9). MMP-9 transcription is activated by Ten-eleven translocation 2 (TET2), a well-known DNA demethylation protein that induces MMP-9 promoter demethylation in diabetic skin tissues. However, how TET2 is targeted to specific loci in the MMP-9 promoter is unknown. Here, we identified a TET2-interacting long noncoding RNA (TETILA) that is upregulated in human diabetic skin tissues. TETILA regulates TET2 subcellular localization and enzymatic activity, indirectly activating MMP-9 promoter demethylation. TETILA also recruits thymine-DNA glycosylase (TDG), which simultaneously interacts with TET2, for base excision repair-mediated MMP-9 promoter demethylation. Together, our results suggest that the TETILA serves as a genomic homing signal for TET2-mediated demethylation specific loci in MMP-9 promoter, thereby disrupting the process of diabetic skin wound healing.