Keloids are locally aggressive scars that typically invade into healthy surrounding skin and cause both physical and psychosocial distress to the patient. These pathological scars occur following minimal skin trauma after a variety of causes including burns and trauma. Although the pathogenesis of keloid disease is not well understood, it is considered to be the end product of an abnormal healing process. The aim of this review was to investigate the molecular and cellular pathobiology of keloid disease in relation to the normal wound healing process. The molecular aberrances in keloids that correlate with the molecular mechanisms in normal wound healing can be categorized into three groups: (1) extracellular matrix proteins and their degradation, (2) cytokines and growth factors, and (3) apoptotic pathways. With respect to cellular involvements, fibroblasts are the most well-studied cell population. However, it is unclear whether the fibroblast is the causative cell; they are modulated by other cell populations in wound repair, such as keratinocytes and macrophages. This review presents a detailed account of individual phases of the healing process and how they may potentially be implicated in aberrant raised scar formation, which may help in clarifying the mechanisms involved in keloid disease pathogenesis.