Prolonged tissue ischemia and inflammation lead to organ deterioration and are often accompanied by microvasculature rarefaction, fibrosis, and elevated systemic Activin A (ActA), the level of which frequently correlates with disease severity. Mesenchymal stromal cells are prevalent in the perivascular niche and are likely involved in tissue homeostasis and pathology. This study investigated the effects of inflammatory cells on modulation of phenotype of adipose mesenchymal stromal cells (ASC) and the role of ActA in this process. Peripheral blood mononuclear cells were activated with lipopolysaccharide (activated peripheral blood mononuclear cells [aPBMC]) and presented to ASC. Expression of smooth muscle/myofibroblast markers, ActA, transforming growth factors beta 1-3 (TGFβ1-3), and connective tissue growth factor (CTGF) was assessed in ASC. Silencing approaches were used to dissect the signaling cascade of aPBMC-induced acquisition of myofibroblast phenotype by ASC. ASC cocultured with aPBMC or exposed to the secretome of aPBMC upregulated smooth muscle cell markers alpha smooth muscle actin (αSMA), SM22α, and Calponin I; increased contractility; and initiated expression of ActA. Interleukin (IL)-1β was sufficient to replicate this response, whereas blocking IL-1β eliminated aPBMC effects. ASC-derived ActA stimulated CTGF and αSMA expression in ASC; the latter independent of CTGF. Induction of αSMA in ASC by IL-1β or ActA-enriched media relied on extracellular enzymatic activity. ActA upregulated mRNA levels of several extracellular matrix proteins in ASC, albeit to a lesser degree than TGFβ1, and marginally increased cell contractility. In conclusion, the study suggests that aPBMC induce myofibroblast phenotype with weak fibrotic activity in perivascular progenitors, such as ASC, through the IL-1β-ActA signaling axis, which also promotes CTGF secretion, and these effects require ActA extracellular enzymatic processing.