To establish a system for assessing drug permeation and irritation of the skin, the permeation of benzoic acid and isosorbide dinitrate, which are listed in the Pharmacopoeia, and the chemical irritation were evaluated using skin generated from human induced pluripotent stem cells (iPSCs). Multilayer structures and cellular markers (keratin 14 and 10, which are in basal and suprabasal epidermal layers) were clearly detected in our iPSC-based skin. Transepidermal water loss (TEWL) decreased after iPSC-derived keratinocytes were cultured on collagen gels from human primary fibroblasts. These results indicate that the barrier function was partly increased by formation of the living epidermis. The cumulative amount of benzoic acid and isosorbide dinitrate across human iPSC-based skin gradually increased after an initial lag time. Moreover, the irritancy of various chemicals (non-irritants: ultrapure water, allyl phenoxy-acetate, isopropanol, and hexyl salicylate and irritants: 5% sodium dodecyl sulfate (SDS), heptanal, potassium hydroxide (5% aq.) and cyclamen aldehyde) to iPSC-based skin was almost met the irritation criteria of the Organisation for Economic Co-operation and Development (OECD) guideline. The results of our iPSC-based skin evaluation provide useful basic information for developing an assessment system to predict the permeation and safety of new transdermal drugs in human skin.