The senescence of alveolar type II (AT2) cells impedes self-repair of the lung epithelium and contributes to lung injury in the setting of idiopathic pulmonary fibrosis (IPF). Yes-associated protein 1 (YAP1) is essential for cell growth and organ development; however, the role of YAP1 in AT2 cells during pulmonary fibrosis is still unclear. YAP1 expression was found to be downregulated in the AT2 cells of PF patients. Deletion of YAP1 in AT2 cells resulted in lung injury, exacerbated extracellular matrix (ECM) deposition, and worsened lung function. In contrast, overexpression of YAP1 in AT2 cells promoted alveolar regeneration, mitigated pulmonary fibrosis, and improved lung function. In addition, overexpression of YAP1 alleviated bleomycin (BLM) -induced senescence of alveolar epithelial cells both in vivo and in vitro. Moreover, YAP1 promoted the expression of peroxiredoxin 3 (Prdx3) by directly interacting with TEAD1. Forced expression of Prdx3 inhibited senescence and improved mitochondrial dysfunction in BLM-treated MLE-12 cells, whereas depletion of Prdx3 partially abrogated the protective effect of YAP1. Furthermore, overexpression of Prdx3 facilitated self-repair of the injured lung and reduced ECM deposition, while silencing Prdx3 attenuated the antifibrotic effect of YAP1. In conclusion, this study demonstrated that YAP1 alleviates lung injury and pulmonary fibrosis by regulating Prdx3 expression to improve mitochondrial dysfunction and block senescence in AT2 cells, revealing a potential novel therapeutic strategy for pulmonary fibrosis.