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RNA-binding proteins (RBPs) are recognized as key posttranscriptional regulators that not only modulate the spatiotemporal expression of genes during organism development but also regulate disease pathogenesis. Very limited information exists on the potential role of RBPs in modulating kidney fibrosis, which is a major hallmark of chronic kidney disease. Here, we report a novel mechanism in kidney fibrosis involving a RBP, Musashi homologue 1 (Msi1), which is expressed in tubular epithelial cells. Using two mechanistically distinct mouse models of kidney fibrosis, we show that Msi1 protein levels are significantly down-regulated in the kidneys following fibrosis. We found that Msi1 functions by negatively regulating the translation of its target mRNAs, p21 and Numb, whose protein levels are markedly increased in kidney fibrosis. Also, Msi1 overexpression and knockdown in kidney epithelial cells cause p21- and Numb-mediated cell cycle arrest. Furthermore, we observed that Numb looses its characteristic membrane localization in fibrotic kidneys and therefore is likely unable to inhibit Notch resulting in tubular cell death. Oleic acid is a known inhibitor of Msi1 and injecting oleic acid followed by unilateral ureteral obstruction surgery in mice resulted in enhanced fibrosis compared with the control group, indicating that inhibiting Msi1 activity renders the mice more susceptible to fibrosis. Given that deregulated fatty acid metabolism plays a key role in kidney fibrosis, these results demonstrate a novel connection between fatty acid and Msi1, an RNA-binding protein, in kidney fibrosis.