The signal transducer and activator of transcription (Stat)-1 mediates growth arrest and apoptosis. We postulated that lung fibrosis characterized by excessive proliferation of lung fibroblasts would be enhanced in Stat1-deficient (Stat1-/-) mice. Two weeks after bleomycin aspiration (3 U/kg), Stat1-/- mice exhibited a more severe fibroproliferative response and significantly elevated total lung collagen compared to wild-type mice. Growth factors [epidermal growth factor (EGF) or platelet-derived growth factor (PDGF)] enhanced [3H]thymidine uptake in lung fibroblasts isolated from Stat1-/- mice compared to wild-type mice. Interferon (IFN)-gamma, which signals growth arrest via Stat1, inhibited EGF- or PDGF-stimulated mitogenesis in wild-type fibroblasts but enhanced [3H]thymidine uptake in Stat1-/- fibroblasts. Moreover, IFN-gamma treatment in the absence of growth factors induced a concentration-dependent increase in [3H]thymidine uptake in Stat1-/- but not wild-type fibroblasts. Mitogen-activated protein kinase (ERK-1/2) phosphorylation in response to PDGF or EGF did not differ among Stat1-/- and wild-type fibroblasts. However, Stat3 phosphorylation induced by PDGF, EGF, or IFN-gamma increased twofold in Stat1-/- fibroblasts compared to wild-type fibroblasts. Our findings indicate that Stat1-/- mice are more susceptible to bleomycin-induced lung fibrosis than wild-type mice due to 1) enhanced fibroblast proliferation in response to growth factors (EGF and PDGF), 2) stimulation of fibroblast growth by a Stat1-independent IFN-gamma signaling pathway, and 3) increased activation of Stat3.