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Mast-cell expressed membrane protein-1 (MCEMP1) is higher in patients with idiopathic pulmonary fibrosis (IPF) with an increased risk of death. Here we aimed to establish the mechanistic role of MCEMP1 in pulmonary fibrosis. We identified increased MCEMP1 expression in classical monocytes and alveolar macrophages in IPF compared with controls. MCEMP1 is upregulated by transforming growth factor beta (TGFβ) at the mRNA and protein levels in monocytic leukemia THP-1 cells. TGFβ-mediated MCEMP1 upregulation results from the cooperation of SMAD3 and SP1 via concomitant binding to SMAD3/SP1 cis- regulatory elements within the MCEMP1 promoter. We also found that MCEMP1 regulates TGFβ-mediated monocyte chemotaxis, adhesion, and migration. Our results suggest that MCEMP1 may regulate the migration and transition of monocytes to monocyte-derived alveolar macrophages during pulmonary fibrosis development and progression. NEW & NOTEWORTHY MCEMP1 is highly expressed in circulating classical monocytes and alveolar macrophages in IPF, is regulated by TGFβ, and participates in the chemotaxis, adhesion, and migration of circulating monocytes by modulating the effect of TGFβ in RHO activity.