Idiopathic pulmonary fibrosis (IPF) is a progressive disease with unknown etiology and limited therapeutic options. Activation of fibroblasts is a prominent feature of pulmonary fibrosis. Here we report that lncRNA DACH1 (dachshund homolog 1) is downregulated in the lungs of IPF patients and in an experimental mouse model of lung fibrosis. LncDACH1 knockout mice develop spontaneous pulmonary fibrosis, whereas overexpression of LncDACH1 attenuated TGF-β1-induced aberrant activation, collagen deposition and differentiation of mouse lung fibroblasts. Similarly, forced expression of LncDACH1 not only prevented bleomycin (BLM)-induced lung fibrosis, but also reversed established lung fibrosis in a BLM model. Mechanistically, LncDACH1 binding to the serine/arginine-rich splicing factor 1 (SRSF1) protein decreases its activity and inhibits the accumulation of Ctnnb1. Enhanced expression of SRSF1 blocked the anti-fibrotic effect of LncDACH1 in lung fibroblasts. Furthermore, loss of LncDACH1 promoted proliferation, differentiation, and extracellular matrix (ECM) deposition in mouse lung fibroblasts, whereas such effects were abolished by silencing of Ctnnb1. In addition, a conserved fragment of LncDACH1 alleviated hyperproliferation, ECM deposition and differentiation of MRC-5 cells driven by TGF-β1. Collectively, LncDACH1 inhibits lung fibrosis by interacting with SRSF1 to suppress CTNNB1 accumulation, suggesting that LncDACH1 might be a potential therapeutic target for pulmonary fibrosis.