Peyronie's disease (PD) is characterized by fibrotic plaques in the penile tunica albuginea that cause curvature of the erect penis, and is often accompanied by pain and/or erectile dysfunction. This condition affects up to 9% of men. Treatment is mainly surgical, as pharmacologic therapy has limited efficacy. The pathophysiology of PD is poorly understood, but development of two rat models, extrapolation of what is known about the molecular pathology of other fibrotic conditions, and emphasis on the role of myofibroblasts and adult stem cells are helping to clarify etiology and identify new pharmacologic targets. Recent studies demonstrate a role for oxidative stress and cytokine release-primarily transforming-growth-factor beta1-in development of PD fibrotic plaques. There is evidence indicating that these profibrotic factors interact with antifibrotic defense mechanisms, such as decrease of myofibroblast accumulation, elimination of reactive oxygen species by inducible nitric oxide synthase and neutralization of transforming-growth-factor beta1 by decorin, such that some plaques are in dynamic turnover. Injury to the erect penis is thought to trigger PD by inducing extravasation of fibrin and subsequent synthesis of transforming-growth-factor beta1. Despite the lack of statistical support for a causal association between trauma and PD, it is possible that undetected microtrauma is involved. It is not known whether ossification of PD plaques is linked to fibrosis progression or is a manifestation of an alternative pathway. Both processes seem to be related to activation of fibroblast/myofibroblast differentiation in the tunica albuginea and to osteogenic commitment of stem cells in this tissue.