Sepsis-induced acute lung injury (ALI) is a complex and life-threatening condition characterized by excessive inflammatory responses, ferroptosis, and oxidative stress. A comprehensive investigation and effective therapeutic strategies are crucial for managing this condition. In this study, we established in vivo sepsis models using lipopolysaccharide (LPS) in wild-type (WT) mice and triggering receptor expressed on myeloid cells 2 (TREM2) knockout (TREM2-KO) mice to assess lung morphology, oxidative stress, and ferroptosis. In vitro, RAW264.7 cells with TREM2 overexpression (TREM2-OE) or knockdown (TREM2-SiRNA) were utilized to assess oxidative stress and ferroptosis. RNA sequencing of LPS-stimulated cells transfected with either vector or TREM2-OE revealed significant differences in inflammation- and ferroptosis-related pathways. LPS-induced lung injury and ferroptosis were exacerbated in TREM2-KO mice and TREM2-SiRNA cells but alleviated by the ferroptosis inhibitor ferrostatin-1 (Fer-1). Mechanistically, TREM2-KO led to SHP1 downregulation and STAT3-P upregulation, which were reversed by the SHP1 agonist SC-43. These findings highlight the role of TREM2 in the SHP1/STAT3 signaling pathway and its regulatory effects on ferroptosis. Our study demonstrates that TREM2, via the SHP1/STAT3 pathway, suppresses oxidative stress and ferroptosis, thereby significantly mitigating sepsis-induced ALI. These results underscore the pivotal role of TREM2 in modulating inflammatory responses and immunity, providing a theoretical foundation for developing therapeutic strategies.