Idiopathic pulmonary fibrosis is a progressive and usually fatal lung disease characterized by fibroblast proliferation and extracellular matrix remodeling, which result in irreversible distortion of the lung's architecture. Although the pathogenetic mechanisms remain to be determined, the prevailing hypothesis holds that fibrosis is preceded and provoked by a chronic inflammatory process that injures the lung and modulates lung fibrogenesis, leading to the end-stage fibrotic scar. However, there is little evidence that inflammation is prominent in early disease, and it is unclear whether inflammation is relevant to the development of the fibrotic process. Evidence suggests that inflammation does not play a pivotal role. Inflammation is not a prominent histopathologic finding, and epithelial injury in the absence of ongoing inflammation is sufficient to stimulate the development of fibrosis. In addition, the inflammatory response to a lung fibrogenic insult is not necessarily related to the fibrotic response. Clinical measurements of inflammation fail to correlate with stage or outcome, and potent anti-inflammatory therapy does not improve outcome. This review presents a growing body of evidence suggesting that idiopathic pulmonary fibrosis involves abnormal wound healing in response to multiple, microscopic sites of ongoing alveolar epithelial injury and activation associated with the formation of patchy fibroblast-myofibroblast foci, which evolve to fibrosis. Progress in understanding the fibrogenic mechanisms in the lung is likely to yield more effective therapies.