Regulatory T (Treg) cells are well recognized for their role in immune regulation; however, their role in tissue regeneration is not fully understood. This study demonstrates such a role of Tregs in a published preclinical murine model of spontaneous pulmonary fibrosis (PF) expressing a human PF related mutation in the Surfactant Protein-C (SP-C) gene (SFTPCI73T). Genetic crosses of SP-CI73T mice with Foxp3GFP and Foxp3DTR lines were utilized to study Treg behavior during PF development. We found that FoxP3+Tregs accumulate during the transition from inflammation to fibrogenesis, peaking at 21-28 days after mutant SftpcI73T induction localizing to both perivascular and distal fibrotic lung regions. Diphtheria toxin mediated ablation of Tregs at 17 days worsened fibrosis and increased levels of TGFβ and inflammatory cytokines. Tregs expressed Th2 markers (Gata3+) and elaborated factors including amphiregulin (Areg) and Osteopontin (Spp1). Reductionist experiments showed that lung Tregs enhanced organoid formation when co-cultured with alveolar epithelial cells and adventitial fibroblasts, an effect size mimicked using Areg and Spp1 in combination. Our findings demonstrate that immune-mesenchymal-epithelial signaling crosstalk is present in the distal lung wherein Tregs play a protective role by limiting fibrosis and promoting tissue repair, highlighting their broader function beyond immune modulation in lung injury. ### Competing Interest Statement The authors have declared no competing interest. National Institutes of Health, https://ror.org/01cwqze88, 1R01HL145408, HL152970, HL007586, HL150226, 1K99HL171946