The mechanisms of pulmonary fibrosis are complex, and several hypotheses have been put forward to explain how fibrosis develops. It was long thought that inflammation was a key event in the process; however, this has recently been challenged. The inflammation hypothesis has led to the description of numerous inflammatory and profibrotic mediators in the pathogenesis of fibrosis. Inhibition of inflammation can attenuate fibrosis in animal models but is less successful in humans. More recently, an important role for epithelial injury, circulating mesenchymal precursor cells, epithelial-to-mesenchymal transition, and vascular remodeling have been described in various models of fibrosis. Many of the classic inflammatory and profibrotic mediators are important in these processes, as well. The development of effective therapies will require the understanding of the complex interplay of the various mediators and the mechanisms of remodeling.