Idiopathic pulmonary fibrosis (IPF) causes considerable global morbidity and mortality, and its mechanisms of disease progression are poorly understood. Recent observational studies have reported associations between lung dysbiosis, mortality, and altered host defense gene expression, supporting a role for lung microbiota in IPF. However, the causal significance of altered lung microbiota in disease progression is undetermined. To examine the effect of microbiota on local alveolar inflammation and disease progression using both animal models and human subjects with IPF. For human studies, we characterized lung microbiota in BAL fluid from 68 patients with IPF. For animal modeling, we used a murine model of pulmonary fibrosis in conventional and germ-free mice. Lung bacteria were characterized using 16S rRNA gene sequencing with novel techniques optimized for low-biomass sample load. Microbiota were correlated with alveolar inflammation, measures of pulmonary fibrosis, and disease progression. Disruption of the lung microbiome predicts disease progression, correlates with local host inflammation, and participates in disease progression. In patients with IPF, lung bacterial burden predicts fibrosis progression, and microbiota diversity and composition correlate with increased alveolar profibrotic cytokines. In murine models of fibrosis, lung dysbiosis precedes peak lung injury and is persistent. In germ-free animals, the absence of a microbiome protects against mortality. Our results demonstrate that lung microbiota contribute to the progression of IPF. We provide biological plausibility for the hypothesis that lung dysbiosis promotes alveolar inflammation and aberrant repair. Manipulation of lung microbiota may represent a novel target for the treatment of IPF.