Hirsutella sinensis mycelium (HSM), the anamorph of Cordyceps sinensis, is a traditional Chinese medicine that has been shown to possess various pharmacological properties. We previously reported that this fungus suppresses interleukin-1β and IL-18 secretion by inhibiting both canonical and non-canonical inflammasomes in human macrophages. However, whether HSM may be used to prevent lung fibrosis and the mechanism underlying this activity remain unclear. Our results show that pretreatment with HSM inhibits TGF-β1–induced expression of fibronectin and α-SMA in lung fibroblasts. HSM also restores superoxide dismutase expression in TGF-β1–treated lung fibroblasts and inhibits reactive oxygen species production in lung epithelial cells. Furthermore, HSM pretreatment markedly reduces bleomycin–induced lung injury and fibrosis in mice. Accordingly, HSM reduces inflammatory cell accumulation in bronchoalveolar lavage fluid and proinflammatory cytokines levels in lung tissues. The HSM extract also significantly reduces TGF-β1 in lung tissues, and this effect is accompanied by decreased collagen 3α1 and α-SMA levels. Moreover, HSM reduces expression of the NLRP3 inflammasome and P2X7R in lung tissues, whereas it enhances expression of superoxide dismutase. These findings suggest that HSM may be used for the treatment of pulmonary inflammation and fibrosis.