The inhalation of vanadium pentoxide (V(2)O(5)) results in bronchitis and airway fibrosis. The lung fibrotic response to V(2)O(5) partially resolves where fibroblasts first proliferate and deposit collagen, but then undergo growth arrest and apoptosis. STAT-1 mediates fibroblast growth arrest and apoptosis. We previously reported that STAT-1 is a protective factor and mice lacking STAT-1 are more susceptible to lung fibrosis. We also reported that V(2)O(5)-induced STAT-1 phosphorylation in lung fibroblasts requires H(2)O(2) and de novo protein synthesis. In this study, we identified IFN-beta as the protein that mediates STAT-1 activation by V(2)O(5) in normal human lung fibroblasts and identified NADPH and xanthine oxidase systems as sources of H(2)O(2) that drive IFN-beta gene expression. STAT-1 phosphorylation was decreased with neutralizing Abs to IFN-beta as well as an inhibitor of JAK. V(2)O(5) also increased transcription of an IFN-inducible and STAT-1-dependent chemokine, CXCL10. Inhibition of H(2)O(2)-generating enzyme systems NADPH oxidase by apocynin and xanthine oxidase by allopurinol individually reduced STAT-1 phosphorylation. Apocynin and allopurinol also decreased V(2)O(5)-induced IFN-beta mRNA levels and CXCL10 expression. IFN-alpha transcription was inhibited only by allopurinol. Taken together, these data indicate that fibroblasts play a role in the innate immune response to vanadium-induced oxidative stress by synthesizing IFN-beta and activating STAT-1 to cause growth arrest and increase levels of CXCL10, a potent antifibrotic factor. This mechanism is postulated to counterbalance profibrogenic mechanisms that follow V(2)O(5) injury.