Dracocephalum Moldavica L. is a traditional herb for improving pharynx and relieving cough. However, the effect on pulmonary fibrosis is not clear. In this study, we explored the impact and molecular mechanism of total flavonoid extract from Dracocephalum moldavica L. (TFDM) on bleomycin‐induced pulmonary fibrosis mouse model. Lung function testing, lung inflammation and fibrosis, and the related factors were detected by the lung function analysis system, HE and Masson staining, ELISA, respectively. The expression of proteins was studied through Western Blot, immunohistochemistry, and immunofluorescence while the expression of genes was analyzed by RT‐PCR. The results showed that TFDM significantly improved lung function in mice, reduced the content of inflammatory factors, thereby reducing the inflammation. It was found that expression of collagen type I, fibronectin, and α‐smooth muscle actin was significantly decreased by TFDM. The results further showed that TFDM interferes with hedgehog signaling pathway by decreasing the expression of Shh, Ptch1, and SMO proteins and thereby inhibiting the generation of downstream target gene Gli1 and thus improving pulmonary fibrosis. Conclusively, these findings suggest that TFDM improve pulmonary fibrosis by reducing inflammation and inhibition of the hedgehog signaling pathway.