The aim of this study is to demonstrate the bleomycin induced histological changes in the lung and the possible protective and /or theraputic effect of stem cell therapy against these changes. Materials and methods: this study was carried out on 36 adult male albino rats. They were classified into 4 groups: group I (control group), group II (bleomycin treated group), group III (early stem cell treated group: immediately after bleomycin treatment), group IV (late stem cell treated group: 7 days after bleomycin treatment). Sections were taken from rats at the 14th day of the experiment. Sections were stained with Hematoxylin and Eosin, Masson's trichrome, immunohistochemichal stains for α-SMA and PCNA. Sections were examined by light microscopyand immunofluroscent microscopy for PKH26-labeled MSCs. The area percent of collagen fibers, area percent and optical density of α-SMA immunopositive cells were measured as well as the number of pneumocytes type II cells in HandE and PCNA immunostained sections was counted using image analyzer. Results: The H and E stained-sections in group II showed, thickening of septa, extravasation of blood, cellular infiltration, fibroblast proliferation, almost complete loss of normal lung architecture in certain fields, consolidation with compensatory emphysema and replacement of the lung tissue with fibrous tissue in other fields, dividing pneumocytes type II cells with acinar formation. A significant increase in the mean number of pneumocytes type II cells in HandE and PCNA immunostained sections was recorded in group II versus group III and the control group. PKH26-labeled cells were found in the lung tissue of both groups III and group IV. Restoring of lung tissue with significant decrease in mean area % of collagen fibers and mean area % of α-SMA immunopositive cells were detected in group III when compared with both groups II and IV.Conclusion: Early treatment with bone marrow derived mesenchymal stem cells (BMSCs) immediately after bleomycin administration showed a significant reduction in fibrotic changes of the lung, however the late treatment with BMSCs (7 days) after bleomycin administration showed non significant reduction of bleomycin induced pulmonary fibrosis.