In patients who die after severe acute lung injury, a dramatic fibroproliferative response occurs within the alveolar air space, interstitium, and microvessels. Profound shunt physiology, dead space ventilation, and pulmonary hypertension are the physiologic consequences of this fibroproliferative response. The anatomic pattern of the response is unique within each alveolar compartment. For example, the air space is obliterated by granulation tissue, with replicating mesenchymal cells, their connective tissue products, and an expanding network of intra-alveolar capillaries. In contrast, the vascular fibroproliferative response is dominated by mesenchymal cell replication and connective tissue deposition within the walls of microvessels. Despite the unique anatomic features of these fibroproliferative processes, the regulatory signals involved are likely to be similar. Although our current understanding of the signals regulating the fibroproliferative response to acute lung injury is limited, inferences can be made from in vitro studies of mesenchymal cell behavior and several better understood fibroproliferative processes, including wound healing and chronic fibrotic lung diseases. As clinicians, our future ability to enhance effective lung repair will likely utilize therapeutic strategies specifically targeted to the signals that regulate the fibroproliferative process within the alveolar microenvironment.