Balancing skin hydration levels is important as any disruption in skin integrity will result in disturbance of the dermal water balance. The discovery that a moist environment actively supports the healing response when compared with a dry environment highlights the importance of water and good hydration levels for optimal healing. The benefits of 'wet' or 'hyper-hydrated' wound healing appear similar to those offered by moist over a dry environment. This suggests that the presence of free water may not be detrimental to healing, but any adverse effects of wound fluid on tissues is more likely related to the biological components contained within chronic wound exudate, for example elevated protease levels. Appropriate dressings applied to wounds must not only be able to absorb the exudate, but also retain this excess fluid together with its protease solutes, while concurrently preventing desiccation. This is particularly important in the case of chronic wounds where peri-wound skin barrier properties are compromised and there is increased permeation across the injured skin. This review discusses the importance of appropriate levels of hydration in skin, with a particular focus on the need for optimal hydration levels for effective healing. • Declaration of interest: This paper was supported by Paul Hartmann Ltd. The authors have provided consultative services to Paul Hartmann Ltd.