Caveolin-1, the structural and signaling protein of caveolae, is an important negative regulator of endothelial nitric oxide synthase (eNOS). We observed that mice lacking caveolin-1 (Cav1^−/−) had twofold increased plasma NO levels but developed pulmonary hypertension. We measured pulmonary vascular resistance (PVR) and assessed alterations in small pulmonary arteries to determine the basis of the hypertension. PVR was 46% greater in Cav1^−/− mice than wild-type (WT), and increased PVR in Cav1^−/− mice was attributed to precapillary sites. Treatment with N^G-nitro-l-arginine methyl ester (l-NAME) to inhibit NOS activity raised PVR by 42% in WT but 82% in Cav1^−/− mice, indicating greater NO-mediated pulmonary vasodilation in Cav1^−/− mice compared with WT. Pulmonary vasculature of Cav1^−/− mice was also less reactive to the vasoconstrictor thromboxane A₂ mimetic (U-46619) compared with WT. We observed redistribution of type I collagen and expression of smooth muscle α-actin in lung parenchyma of Cav1^−/− mice compared with WT suggestive of vascular remodeling. Fluorescent agarose casting also showed markedly decreased density of pulmonary arteries and artery filling defects in Cav1^−/− mice. Scanning electron microscopy showed severely distorted and tortuous pulmonary precapillary vessels. Thus caveolin-1 null mice have elevated PVR that is attributed to remodeling of pulmonary precapillary vessels. The elevated basal plasma NO level in Cav1^−/− mice compensates partly for the vascular structural abnormalities by promoting pulmonary vasodilation.