Idiopathic pulmonary fibrosis (IPF) represents a terminal, age-related disease characterized by a complex pathophysiology. Recent studies have reported the presence of basal cells in IPF lungs, yet their specific role and impact on other cell types within the fibrotic lung remains unclear. Lung resident mesenchymal stem cells (MSCs) are a crucial resident stem cell population essential for maintaining lung homeostasis; MSCs exhaustion, a hallmark of aging, has been implicated in IPF through poorly understood mechanisms. In this study, we investigated the effects of hepatocyte growth factor (HGF), an anti-fibrotic factor, on MSCs quiescence using a bleomycin-induced lung injury model. RNA-sequencing analysis of basal cells isolated from IPF lungs identified upregulation of matrix metalloproteinase 24 (MMP24) in IPF (2.45±0.53) compared to non-IPF basal cells (1.12±0.2) (p˂0.05). Moreover, in vivo experiments indicated increased MMP24 levels in bleomycin injured lung homogenates compared to healthy lungs (6.89±0.78 vs 3.52±0.65 ng/mL) p<0.01, and decreased frequencies of activated lung MSCs in bleomycin-injured lungs compared to healthy lungs (21.8±6.2% vs 51.0±9.3%) p<0.01. Consistently, in vivo overexpression of MMP24 resulted in enhanced quiescence of lung MSCs and increased fibrosis. Conversely, in vivo HGF gene transfer increased frequencies of activated lung MSCs (27.5±3.2%, p<0.05) and reduced MMP24 levels in lung homogenates (4.39±0.38 ng/mL, p<0.001). Mechanistically, HGF reduced MMP24 expression through the YAP-1 pathway. Collectively, our findings uncover MMP24 as a pro-fibrotic mediator in IPF patients and in bleomycin injured lung and identify HGF-YAP1-MMP24 as a novel therapeutic axis in lung fibrosis.