Objective To analyze the application effect of medical paste dressing in inflammatory skin diseases and its influence on skin barrier function. Methods A total of 240 patients with inflammatory skin diseases admitted to our hospital from January 2022 to December 2024 were selected as the research subjects, and they were divided into the control group and the observation group by the random number table method, with 120 patients in each group. The control group was treated with conventional treatment, and the observation group was treated with medical paste dressing on the basis of conventional treatment. The treatment effect, skin barrier function, inflammatory response degree, wound healing time, pain degree and adverse reaction rate were compared between the two groups. Results The total effective rate of the observation group (94.17%) was higher than that of the control group (78.33%) (P <0.05). The total effective rates of dermatitis, eczema, acne and herpes wound treatment in the observation group were higher than those in the control group (P <0.05). The skin barrier function indexes of the observation group were better than those of the control group (P <0.05). The degree of inflammatory response of the observation group was better than that of the control group (P <0.05). The wound healing time and pain degree score of the observation group were better than those of the control group (P <0.05). The incidence of adverse reactions in the observation group (4.17%) was lower than that in the control group (8.33%), but the difference was not statistically significant (P >0.05). Conclusion Medical paste dressing can effectively improve the wound healing quality of patients with inflammatory skin diseases, reduce the degree of inflammatory response and pain, reconstruct skin barrier function, effectively shorten the wound healing time, and not increase adverse reactions, thus effectively improving the clinical effect.