Objective To characterize the musculoskeletal lesions in patients with localized scleroderma (morphea) using MRI and examine inter-reader reliability. Materials and methods This was a retrospective study at a tertiary center with approval from the institutional review board. Forty-nine consecutive patients with final clinical diagnosis of Morphea (37 females, 12 males, mean age 39.04 +/- 16.12 years) with different subtypes (20 Linear, 13 Generalized, 5 En coupe de Sabre, 4 Parry Romberg, 3 Eosinophilic Fasciitis 2 Plaque, and 2 Other) underwent MR imaging from 2016-2024. Three musculoskeletal radiologists evaluated different compartment involvements by Morphea- skin, fat, superficial/deep/intermuscular fascia, muscle/nerve, joint/bone, and depth of involvement as superficial or deep. Inter-reader analysis was performed using weighted Conger's Kappa and Intraclass Correlation Coefficient. Results Among 49 patients with 49 MRI scans, 31 (63%) exhibited superficial lesions, and 18 (37%) had deep lesions. The MRI findings included- skin thickening in 37 (76%) and thinning in 10 (20%); fat atrophy in 35 (71%), and hypertrophy in 1 (2%). Thickening and edema were observed in 34 (69%) superficial fascia and 33 (67%) deep fascia. Muscle edema and bone/joint involvement were present in 11/18 deep lesions (61%) and 2 patients (4%), respectively. The depth of involvement showed good inter-rater agreement (ICC = 0.71 (95% CI: 0.58, 0.82)), with the highest reliability found for intermuscular fascial involvement (Conger's Kappa = 0.79). Conclusion We demonstrated an efficient MRI protocol for categorizing Morphea variations across tissue compartments, achieving good-fair inter-rater reliability, and identified deep tissue involvement in about one-third of cases.