The age range for this study is 50-80 years, inclusive. There are 6 visits over the 12 month period. These visits include physical exams, pregnancy tests (if applicable), several symptom scales and questionnaires about your pulmonary fibrosis, pulmonary function testing, x-rays,peripheral nerve testing, and blood tests including arterial blood gas measurements. You will be given the medication in capsule form every 28 days for a year. There is a set schedule for increasing the doses of the thalidomide every 2 weeks until it reaches the 400 mg. dose that is being studies. A stool softener is also provided for each participant.