Inflammatory bowel disease (IBD) is a chronic, relapsing disease of the gastrointestinal (GI) tract of uncertain origin. Its two main phenotypes are Crohn’s disease (CD) and ulcerative colitis (UC). CD affects any part of the GI tract and is characterized by transmural inflammation, whereas UC is confined to the colon and affects only the mucosal layer. IBD is thought to occur in genetically predisposed individuals that develop an abnormal immune response to enteric bacteria in the intestinal mucosa (Podolsky, 2002; Xavier RJ & Podolsky, 2007). Disease occurs as a result of complex and dynamic interactions between immune and non-immune cells as well as the cross-talk between intestinal epithelium and mesenchyme (Danese, 2011; MacDonald et al., 2011; Strober & Fuss, 2011). Therefore, factors that are able to influence both interactions may be very important for the pathogenesis and treatment of IBD. Bone morphogenetic proteins (BMPs) are a large group of structurally related proteins that belong to the transforming growth factor-β (TGF-β) superfamily. Along with their primarily osteogenic function their importance in development, proliferation and morphogenesis of a variety of cells and tissues has been shown (Hogan, 1996; Vukicevic et al., 1989; 1995; Wozney et al., 1988). In addition, association of BMPs with healing processes of different non-skeletal tissues and organs was also described (Lories et al., 2005; Martinovic et al., 2002; Nguyen et al., 2008; Simic & Vukicevic, 2004; Turk et al., 2009; Vukicevic et al., 1996; Vukicevic & Grgurevic, 2009). Due to their wide-range of effects, they are commonly named “body morphogenetic proteins” (Reddi, 2005). Perturbations in BMP expression and BMP signaling pathway have been associated with the pathological conditions linked to several human diseases such as inflammatory bowel disease (IBD) (Allaire et al., 2011; Burke et al., 2007; Krishnan et al., 2011). In this chapter we will discuss the importance of BMPs in gut development and hereditary diseases as well as their influence on cellular and molecular events that occur in IBD and fibrogenesis, the most common complication of IBD. Furthermore, we will address the therapeutical potential of BMPs, especially BMP7 in treatment of IBD. Finally, we will explore the possibility of BMP pathway components as putative biomarkers of gut tumor development and progression.