Cordyceps sinensis, an edible mushroom growing in Himalayan regions, is widely recognized in traditional system of medicine. In the present study, we report the efficacy of Cordyceps sinensis in facilitating tolerance to hypoxia using A549 cell line as a model system. Treatment with aqueous extract of Cordyceps sinensis appreciably attenuated hypoxia induced ROS generation, oxidation of lipids and proteins and maintained antioxidant status similar to that of controls via induction of antioxidant gene HO1 (heme oxygenase-1), MT (metallothionein) and Nrf2 (nuclear factor erythroid-derived 2-like 2). In contrast, lower level of NF κ B (nuclear factor kappaB) and tumor necrosis factor- α observed which might be due to higher levels of HO1, MT and transforming growth factor- β . Further, increase in HIF1 (hypoxia inducible factor-1) and its regulated genes; erythropoietin, vascular endothelial growth factor, and glucose transporter-1 was observed. Interestingly, Cordyceps sinensis treatment under normoxia did not regulate the expression HIF1, NF κ B and their regulated genes evidencing that Cordyceps sinensis per se did not have an effect on these transcription factors. Overall, Cordyceps sinensis treatment inhibited hypoxia induced oxidative stress by maintaining higher cellular Nrf2, HIF1 and lowering NF κ B levels. These findings provide a basis for possible use of Cordyceps sinensis in tolerating hypoxia.