Idiopathic pulmonary fibrosis (IPF) is a group of chronic interstitial pulmonary diseases characterized by myofibroblast proliferation and extracellular matrix deposition with limited treatment options. Based on our previous observation, we hypothesized microcystin-leucine arginine (LR), an environmental cyanobacterial toxin, could potentially suppress pulmonary fibrosis. In this study, we first demonstrated that chronic exposure of microcystin-LR by oral for weeks indeed attenuated the pulmonary fibrosis both on bleomycin-induced rat and fluorescein isothiocyanate-induced mouse models. Our data further indicated that treatment with microcystin-LR substantially reduced TGF-β1/Smad signaling in rat pulmonary tissues. The experiments in vitro found that microcystin-LR was capable of blocking epithelial-mesenchymal transition (EMT) and fibroblast-myofibroblast transition (FMT) through suppressing the differentiation of CD206+ macrophages. Mechanically, microcystin-LR was found to bind to glucose-regulated protein 78 kDa (GRP78) and suppress endoplasmic reticulum unfolded protein response (UPRER) signaling pathways. These events led to the modulation of M2 polarization of macrophages, which eventually contributed to the alleviation of pulmonary fibrosis. Our results revealed a novel mechanism that may account for therapeutic effect of microcystin-LR on IPF.