Acute lung injury due to sulfur mustard (SM) inhalation causes formation of airway fibrin casts that obstruct airways at multiple levels, leading to acute respiratory failure and death. These pathophysiological effects are seen in rodent models of acute SM vapor inhalation, as well as in human victims of acute SM inhalation. In rat models, the initial steps in activation of the coagulation system at extravascular sites depend on tissue factor (TF) expression by airway cells, especially in the microparticle fraction, and these effects can be inhibited by TF pathway inhibitor (TFPI) protein. Not only does the procoagulant environment of the acutely injured lung contribute to airway cast formation, but these lesions persist in airways because of the activation of multiple antifibrinolytic pathways, including plasminogen activator inhibitor-1 (PAI-1), thrombin-activatable fibrinolysis inhibitor (TAFI), and α2-antiplasmin (α2AP). Airway administration of tissue plasminogen activator (tPA) can overwhelm these effects and be save lives by preventing fibrin-dependent airway obstruction, gas-exchange abnormalities, and respiratory failure. In human survivors of SM inhalation, fibrotic processes, including bronchiolitis obliterans and interstitial fibrosis of the lung, are among the most disabling chronic lesions. Antifibrotic therapies may prove useful in preventing either or both of these forms of chronic lung damage.