Utrophin is a potential therapeutic target for the fatal muscle disease, Duchenne muscular dystrophy (DMD). In adult skeletal muscle, utrophin is restricted to the neuromuscular and myotendinous junctions and can compensate for dystrophin loss in mdx mice, a mouse model of DMD, but requires sarcolemmal localization. NFATc1-mediated transcription regulates utrophin expression and the LIM protein, FHL1 which promotes muscle hypertrophy, is a transcriptional activator of NFATc1. By generating mdx/FHL1-transgenic mice, we demonstrate that FHL1 potentiates NFATc1 activation of utrophin to ameliorate the dystrophic pathology. Transgenic FHL1 expression increased sarcolemmal membrane stability, reduced muscle degeneration, decreased inflammation and conferred protection from contraction-induced injury in mdx mice. Significantly, FHL1 expression also reduced progressive muscle degeneration and fibrosis in the diaphragm of aged mdx mice. FHL1 enhanced NFATc1 activation of the utrophin promoter and increased sarcolemmal expression of utrophin in muscles of mdx mice, directing the assembly of a substitute utrophin-glycoprotein complex, and revealing a novel FHL1-NFATc1-utrophin signaling axis that can functionally compensate for dystrophin.