Renal interstitial fibrosis (RIF) is a common manifestation of inflammatory and noninflammatory renal diseases, which correlates to renal excretory dysfunction. Recently, the long noncoding RNAs (lncRNAs) have been demonstrated to be involved in the development of various renal diseases. Here, we aim to determine whether paeonol (PAE) affects RIF with involvement of the lncRNA HOX transcript antisense intergenic RNA (HOTAIR)/microRNA‐124 (miR‐124)/Notch1 axis. RIF rat models were established by performing unilateral ureteral occlusion (UUO), in which interactions between HOTAIR, Notch1, and miR‐124 were determined. To identify the roles of PAE and HOTAIR in RIF, rats were injected with HOTAIR or PAE. Subsequently, to further investigate the underlying mechanism of PAE in RIF, epithelial to mesenchymal transition (EMT)‐ and migration‐related genes in NRK‐49F cells were measured. Next, rats were further treated with IMR‐1 (inhibitor of the Notch1/Jagged1 signaling pathway) to determine how PAE influences the Notch1/Jagged1 signaling pathway. HOTAIR interacted with miR‐124, and miR‐124 directly targeted Notch1, and HOTAIR was observed to be upregulated in RIF rats. PAE was found to decrease HOTAIR and Notch1 expression but to increase the miR‐124 expression in RIF rats. PAE inhibited EMT and migration of NRK‐49F cells facilitated by HOTAIR. HOTAIR activated the Notch1/Jagged1 signaling pathway by downregulating miR‐124, while PAE reversed these effects of HOTAIR on the Notch1/Jagged1 signaling pathway. Overall, our study demonstrates the contributory effect of lncRNA HOTAIR on RIF by activating the Notch1/Jagged1 signaling pathway via inhibition of miR‐124, whereas administration of PAE can alleviate the effects of HOTAIR on RIF.