Mesenchymal stem cells (MSCs) are widely considered for treatment of pulmonary fibrosis based on the anti-inflammatory, antifibrotic, antiapoptotic, and regenerative properties of the cells. Recently, elevated levels of oncostatin M (OSM) have been reported in the bronchoalveolar lavage fluid of a pulmonary fibrosis animal model and in patients. In this work, we aimed to prolong engrafted MSC survival and to enhance the effectiveness of pulmonary fibrosis transplantation therapy by using OSM-preconditioned MSCs. OSM-preconditioned MSCs were shown to overexpress type 2 OSM receptor (gp130/OSMRβ) and exhibited high susceptibility to OSM, resulting in upregulation of the paracrine factor, hepatocyte growth factor (HGF). Moreover, OSM-preconditioned MSCs enhanced cell proliferation and migration, attenuated transforming growth factor-β1- or OSM-induced extracellular matrix production in MRC-5 fibroblasts through paracrine effects. In bleomycin-induced lung fibrotic mice, transplantation of OSM-preconditioned MSCs significantly improved pulmonary respiratory functions and downregulated expression of inflammatory factors and fibrotic factors in the lung tissues. Histopathologic examination indicated remarkable amelioration of the lung fibrosis. LacZ-tagged MSCs were detected in the lung tissues of the OSM-preconditioned MSC-treated mice 18 days after post-transplantation. Taken together, our data further demonstrated that HGF upregulation played an important role in mediating the therapeutic effects of transplanted OSM-preconditioned MSCs in alleviating lung fibrosis in the mice. Stem Cells Translational Medicine 2017;6:1006-1017.