Fibroblasts consist of heterogeneous subpopulations that have distinct roles in fibrotic responses. Previously we reported enhanced proliferation in response to fibrogenic growth factors and selective activation of latent transforming growth factor (TGF)-beta in fibroblasts lacking cell surface expression of Thy-1 glycoprotein, suggesting that Thy-1 modulates the fibrogenic potential of fibroblasts. Here we report that compared to controls Thy-1-/- C57BL/6 mice displayed more severe histopathological lung fibrosis, greater accumulation of lung collagen, and increased TGF-beta activation in the lungs 14 days after intratracheal bleomycin. The majority of cells demonstrating TGF-beta activation and myofibroblast differentiation in bleomycin-induced lesions were Thy-1-negative. Histological sections from patients with idiopathic pulmonary fibrosis demonstrated absent Thy-1 staining within fibroblastic foci. Normal lung fibroblasts, in both mice and humans, were predominantly Thy-1-positive. The fibrogenic cytokines interleukin-1 and tumor necrosis factor-alpha induced loss of fibroblast Thy-1 surface expression in vitro, which was associated with Thy-1 shedding, Smad phosphorylation, and myofibroblast differentiation. These results suggest that fibrogenic injury promotes loss of lung fibroblast Thy-1 expression, resulting in enhanced fibrogenesis.