The pathological hallmark lesions in idiopathic pulmonary fibrosis are the fibroblastic foci, in which fibroblasts are thought to be involved in the tissue remodeling, matrix deposition, and cross-talk with alveolar epithelium. Recent evidence indicates that some fibroblasts in fibrosis may be derived from bone marrow progenitors as well as from epithelial cells through epithelial-mesenchymal transition. To evaluate whether endothelial cells could represent an additional source for fibroblasts, bleomycin-induced lung fibrosis was established in Tie2-Cre/CAG-CAT-LacZ double-transgenic mice, in which LacZ was stably expressed in pan-endothelial cells. Combined X-gal staining and immunocytochemical staining for type I collagen and alpha-smooth muscle actin revealed the presence of X-gal-positive cells in lung fibroblast cultures from bleomycin-treated mice. To explore the underlying mechanisms, by which loss of endothelial-specific markers and gain of mesenchymal phenotypes could be involved in microvascular endothelial cells, the effects of activated Ras and TGF-beta on the microvascular endothelial cell line MS1 were analyzed. Combined treatment with activated Ras and TGF-beta caused a significant loss of endothelial-specific markers, while inducing de novo mesenchymal phenotypes. The altered expression of these markers in MS1 cells with activated Ras persisted after withdrawal of TGF-beta in vitro and in vivo. These findings are the first to show that lung capillary endothelial cells could give rise to significant numbers of fibroblasts through an endothelial-mesenchymal transition in bleomycin-induced lung fibrosis model.