Influenza Virus (IV) pneumonia is associated with severe damage of the lung epithelium and respiratory failure. Apart from efficient host defense, structural repair of the injured epithelium is crucial for survival of severe pneumonia. The molecular mechanisms underlying stem/progenitor cell mediated regenerative responses are not well characterized. In particular, the impact of IV infection on lung stem cells and their regenerative responses remains elusive. Our study demonstrates that a highly pathogenic IV infects various cell populations in the murine lung, but displays a strong tropism to an epithelial cell subset with high proliferative capacity, defined by the signature EpCamhighCD24lowintegrin(α6)high. This cell fraction expressed the stem cell antigen-1, highly enriched lung stem/progenitor cells previously characterized by the signature integrin(β4)+CD200+, and upregulated the p63/krt5 regeneration program after IV-induced injury. Using 3-dimensional organoid cultures derived from these epithelial stem/progenitor cells (EpiSPC), and in vivo infection models including transgenic mice, we reveal that their expansion, barrier renewal and outcome after IV-induced injury critically depended on Fgfr2b signaling. Importantly, IV infected EpiSPC exhibited severely impaired renewal capacity due to IV-induced blockade of β-catenin-dependent Fgfr2b signaling, evidenced by loss of alveolar tissue repair capacity after intrapulmonary EpiSPC transplantation in vivo. Intratracheal application of exogenous Fgf10, however, resulted in increased engagement of non-infected EpiSPC for tissue regeneration, demonstrated by improved proliferative potential, restoration of alveolar barrier function and increased survival following IV pneumonia. Together, these data suggest that tropism of IV to distal lung stem cell niches represents an important factor of pathogenicity and highlight impaired Fgfr2b signaling as underlying mechanism. Furthermore, increase of alveolar Fgf10 levels may represent a putative therapy to overcome regeneration failure after IV-induced lung injury.