Idiopathic pulmonary fibrosis (IPF) is the most common and severe type of idiopathic interstitial pneumonias (IIP), and which is currently no method was developed to restore normal structure and function. There are several reports on therapeutic effects of adult stem cell transplantations in animal models of pulmonary fibrosis. However, little is known about how mesenchymal stem cell (MSC) can repair the IPF. In this study, we try to provide the evidence to show that transplanted mesenchymal stem cells directly replace fibrosis with normal lung cells using IPF model mice. As results, transplanted MSC successfully integrated and differentiated into type II lung cell which express surfactant protein. In the other hand, we examine the therapeutic effects of microvesicle treatment, which were released from mesenchymal stem cells. Though the therapeutic effects of MV treatment is less than that of MSC treatment, MV treat-ment meaningfully reduced the symptom of IPF, such as collagen deposition and inflammation. These data suggest that stem cell transplantation may be an effective strategy for the treatment of pulmonary fibrosis via replacement and cytoprotective effect of microvesicle released from MSCs.