The mechanistic basis of lung injury induced by SARS-CoV-2 remains poorly understood. In the most severe COVID-19 cases, patients develop COVID-19-induced Acute Respiratory Distress Syndrome (ARDS), which is associated with prolonged respiratory failure and high mortality. To comprehend the pathomechanisms of lung damage, we analyzed pulmonary immune responses and lung pathology in two cohorts of patients with COVID-19 ARDS using functional single-cell genomics, immunohistology, and electron microscopy. Phenotypically, we observed an accumulation of CD163-expressing monocyte-derived macrophages that acquired a profibrotic transcriptional phenotype during COVID-19 ARDS. COVID-19 ARDS was associated with clinical, radiographic, histopathological, and ultrastructural characteristics of pulmonary fibrosis. Exposure of human monocytes to SARS-CoV-2, but not influenza A virus or viral RNA analogs, was sufficient to induce a similar profibrotic phenotype in vitro. Altogether, the role of macrophages remains intriguing, and we will discuss whether they are friends or foes.