Hypoxia inducible factor (HIF)−1α could be stabilized by Grx1 deletion, which is implicated critical in the pathogenesis of bronchopulmonary dysplasia (BPD). Until now, the stabilization of HIF‐1α by glutathionylation to regulate the pulmonary microcirculation in BPD is not well addressed. In this study, we investigated whether the HIF‐1α stabilization modulated by Grx1 ablation could ameliorate the pathological changes in the mouse model of BPD, including angiogenesis and alveolar formation. We found that depletion of Grx1 increased levels of GSH‐protein adducts, which was associated with the improvement in the numbers of alveoli, the capillary density in the pulmonary microcirculation and the survival rate in the littermates with hyperoxic exposure. Grx1 ablation could promote HIF‐1α glutathionylation by increasing GSH adducts to stabilize HIF‐1α and to induce VEGF‐A production in the lung tissue. The above phenotype of capillary density and VEGF‐A production was removed by the pharmacological administration of YC‐1, the HIF‐1α inhibitor, suggesting the HIF‐1α dependent manner for pulmonary microcirculatory perfusion. These data indicate that HIF‐1α stabilization plays an critical role in modification pulmonary microcirculatory perfusion, which is associated with the pathological damage under hyperoxic conditions, suggesting that targeting with HIF‐1α stabilization should be a potential clinical and therapeutic strategy for BPD treatment.