Sarcoidosis is a multisystem, granulomatous disease that most often affects the lungs. The clinical course is highly variable; many patients undergo spontaneous remission, but up to a third of patients progresses to a chronic disease course. The development of pulmonary fibrosis (PF) in a subset of patients with chronic disease has a negative impact on morbidity and mortality. While sarcoidosis-associated PF can be progressive, it is often referred to as “burnt out” disease, a designation reflecting inactive granulomatous inflammation. The immune mechanisms of sarcoidosis-associated PF are not well understood. It is not clear if fibrotic processes are active from the onset of sarcoidosis in predisposed individuals, or whether a profibrotic state develops as a response to ongoing inflammation. Transforming growth factor β (TGF-β) is an important profibrotic cytokine, and in sarcoidosis, distinct genotypes of TGF-β have been identified in those with PF. The overall cytokine profile in sarcoidosis-associated PF has not been well characterized, although a transition from a T helper 1 to a T helper 2 signature has been proposed. Macrophages have important regulatory interactions with fibroblasts, and the role of alveolar macrophages in sarcoidosis-associated PF is a compelling target for further study. Elucidating the natural history of sarcoidosis-associated PF will inform our understanding of the fundamental derangements, and will enhance prognostication and the development of therapeutic strategies.