AIM: To explore the functions of Chordin-like 2, which is encoded by CHRDL2, in the process of retinal pigmented epithelium (RPE) differentiation and damage repair. METHODS: The fetal RPE cells (fRPE) was obtained from aborted fetus which obeyed medical ethics. Real-time quantitative polymerase chain reaction was used to measure expression quantity of CHRDL2 and other functional genes expression. Knocking down and overexpression was used to analyze the functions about Chordin-like 2. Enzyme-linked immunosorbent assay (ELISA) was used to detect the secretion of bone morphogenetic proteins 4 (BMP4). Flow cytometry was used to analyze cell cycle. Cell morphology was observed by phase contrast microscope (PCM). RESULTS: In normal RPE cells, CHRDL2 was firstly upregulated and followed a downregulation but eventually, it was expressed higher than the cells which undergone epithelial-mesenchymal transition (EMT). After knocking down CHRDL2, the secretion of BMP4 was decreased, RPE-related genes (OTX2, MITF, RPE65) were downregulated while EMT-related genes (SNAI1, VIM) were upregulated. However, the expression of these related genes after overexpression of CHRDL2 had contrary results. Chordin-like 2 also regulated the cell cycle by regulating BMP pathway. When CHRDL2 was knocked down, more fRPE cells stayed in S phase of cell cycle, while adding BMP4 reduced the proportion of the cells in S phase. However, overexpression of CHRDL2 increased more BMP4 secretion, this effect decreased the number of cells in S phase, but exogenous BMP inhibitor also could change this effect. At last, in the process of RPE cells differentiation, adding BMP4 at early stage could intervene normal RPE differentiation. Compared with BMP4, inhibiting BMP pathway had no significant negative effect at early stage, but suppressed differentiation at late stage. CONCLUSION: BMP pathway can be activated in a correct temporal order, otherwise, the cells have incorrect differentiation orientation. And Chordin-like 2 plays a role in dynamic regulation of BMP pathway and it also regulates the differentiation of RPE cells. Therefore, this research enlightens a new direction to inhibit EMT and promote cell redifferentiation after injury.