Mice deficient in the plasminogen activator inhibitor-1 gene (PAI-1-/- mice) are relatively protected from developing pulmonary fibrosis from bleomycin administration. We hypothesized that one of the protective mechanisms may be the ability of the plasminogen system to enhance hepatocyte growth factor (HGF) effects, which have been reported to be anti-fibrotic in the lung. HGF is known to be sequestered in tissues by binding to extracellular matrix components. Following bleomycin administration, we found that HGF protein levels were higher in bronchoalveolar lavage fluid from PAI-1-/- mice compared to wild-type (PAI-1+/+) mice. This increase could be suppressed by administering tranexamic acid, which inhibits plasmin activity. Conversely, intratracheal instillation of urokinase into bleomycin-injured PAI-1+/+ mice to activate plasminogen caused a significant increase in HGF within bronchoalveolar lavage and caused less collagen accumulation in the lungs. Administration of an anti-HGF neutralizing antibody markedly increased collagen accumulation in the lungs of bleomycin-injured PAI-1-/- mice. These results support the hypothesis that increasing the availability of HGF, possibly by enhancing its release from extracellular matrix by a plasmin-dependent mechanism, is an important means by which activation of the plasminogen system can limit pulmonary fibrosis.