Lung cancer is the leading cause of cancer deaths in the United States. New targeted therapies against the once-deemed undruggable oncogenic KRAS are changing current therapeutic paradigms. However, resistance to targeted KRAS inhibitors almost inevitably occurs; resistance can be driven by tumor cell-intrinsic changes or by changes in the microenvironment. Here, we utilized a genetically engineered mouse model of KRASG12D-driven lung cancer that allows for inducible and reversible expression of the oncogene: activation of oncogenic KRASG12D induces tumor growth; conversely, inactivation of KRASG12D causes tumor regression. We showed that in addition to regulating cancer cell growth and survival, oncogenic KRAS regulated the transcriptional status of cancer-associated fibroblasts and macrophages in this model. Utilizing ex vivo approaches, we showed that secreted factors from cancer cells induced the expression of multiple cytokines in lung fibroblasts, and in turn drove expression of immunosuppressive factors, such as arginase 1, in macrophages. In summary, fibroblasts emerged as a key source of immune regulatory signals, and a potential therapeutic target for improving the efficacy of KRAS inhibitors in lung cancer.