Current treatments for pneumonia (PNA) are focused on the pathogens. Mortality from PNA-induced acute lung injury (PNA-ALI) remains high, underscoring the need for additional therapeutic targets. Clinical and experimental evidence exists for potential sex differences in PNA survival, with males having higher mortality. In a model of severe pneumococcal PNA, when compared to males, age-matched female mice exhibited enhanced resolution characterized with decreased alveolar and lung inflammation and increased numbers of Regulatory T cells (Tregs). Recognizing the critical role of Tregs in lung injury resolution, we evaluated if improved outcomes in females were due to estradiol (E2) effects on Treg biology. E2 promoted Treg suppressive phenotype in vitro and resolution of PNA in vivo. Systemic rescue administration of E2 promoted resolution of PNA in males independent of lung bacterial clearance. E2 augmented Treg expression of Foxp3, CD25 and GATA3, an effect that required ERb, and not ERa signaling. Importantly, the in vivo therapeutic effects of E2 were lost in Treg depleted mice (Foxp3DTR). Adoptive transfer of ex vivo E2-treated Tregs rescued S. pneumoniae-induce PNA-ALI, a salutary effect that required Treg ERβ expression. E2-ERβ was required for Tregs to control macrophage pro-inflammatory responses. Our findings support the therapeutic role for E2 in promoting resolution of lung inflammation after PNA via ERβ Tregs.