Carbon nanotubes (CNTs) have been a subject of intensive research for a wide range of applications. However, because of their extremely small size and light weight, CNTs are readily inhaled into human lungs resulting in increased rates of pulmonary disorders, most notably fibrosis. Several studies have demonstrated the fibrogenic effects of CNTs given their ability to translocate into the surrounding areas in the lung causing granulomatous lesions and interstitial and sub-pleural fibrosis. However, the mechanisms underlying the disease process remain obscure due to the lack of understanding of the cellular interactions and molecular targets involved. Interestingly, certain physicochemical properties of CNTs have been shown to affect their respiratory toxicity, thereby becoming significant determinants of fibrogenesis. CNT-induced fibrosis involves a multitude of cell types and is characterized by the early onset of inflammation, oxidative stress and accumulation of extracellular matrix. Increased reactive oxygen species activate various cytokine/growth factor signaling cascades resulting in increased expression of inflammatory and fibrotic genes. Profibrotic growth factors and cytokines contribute directly to fibroblast proliferation and collagen production. Given the role of multiple players during the pathogenesis of CNT-induced fibrosis, the objective of this review is to summarize the key findings and discuss major cellular and molecular events governing pulmonary fibrosis. We also discuss the physicochemical properties of CNTs and their effects on pulmonary toxicities as well as various biological factors contributing to the development of fibrosis.