Glucocorticoids have been widely used and exert pleiotropic effects on alveolar structure and function, but do not improve the long-term clinical outcomes for patients with bronchopulmonary dysplasia, emphysema, or interstitial lung diseases. Treatments which foster alveolar regeneration could substantially improve the long-term outcomes for such patients. One approach to alveolar regeneration is to stimulate and guide intrinsic alveolar progenitors along developmental pathways used during secondary septation. We and others have identified platelet-derived growth factor receptor-alpha (PDGFRα)-expressing fibroblast subpopulations which are alternatively skewed towards myofibroblast (MF) or lipofibroblast (LIF) phenotypes. In this study we have administered either the glucocorticoid receptor (GR) agonist dexamethasone (Dex) or the antagonist mifepristone (Mfp) to mice during the first postnatal week and evaluated their effects on cellular proliferation and adoption of α-smooth muscle actin (αSMA) and lipid droplets, markers of the MF and LIF phenotypes, respectively. We observed that Dex increased the relative abundance of fibroblasts with progenitor characteristics: contain both αSMA and lipid droplets, uncoupling protein-1 (UCP1) a marker of brown and beige adipocytes, delta-like ligand-1 (Dlk1) and stem cell antigen-1 (Sca1). Dexamethasone enhanced signaling through the Smad1/5/ pathway, which increased UCP1 in a lung fibroblast progenitor cell line. We conclude that GR-manipulation can sustain fibroblast plasticity and posit that targeting downstream glucocorticoid responsive pathways could steer fibroblasts progenitors along more desirable regenerative pathways.