Sepsis is a life-threatening condition caused by severe infection and often complicates acute respiratory distress syndrome (ARDS) and acute lung injury (ALI) due to the collapse of the oxidative and inflammatory balance induced by microbial pathogens, including lipopolysaccharides (LPS). In sepsis-related ARDS/ALI, NADPH oxidase (NOX) and toll-like receptors (TLR) in neutrophils and macrophages are key players in initiating oxidative and inflammatory imbalances. Although NOX and TLR activation has been linked to carbon monoxide (CO), the mechanism by which CO affects sepsis-related ARDS/ALI through NOX and TLR remains unknown. Here, we demonstrate that CO reduces sepsis-related ARDS/ALI by inhibiting NOX in neutrophils and macrophages, which in turn suppresses the production of reactive oxygen species (ROS), TLR4-associated inflammatory responses, and macrophage polarization toward M1-like macrophages. CO-bound hemoglobin vesicle (CO-HbV) therapy, a hemoglobin-based CO donor, exerts a protective effect against LPS-induced ALI by suppressing exaggerated oxidative and inflammatory responses and neutrophil and M1-like macrophage infiltration in the bronchoalveolar lavage fluid (BALF). Through suppression of NOX activity, CO decreased ROS generation, the TLR4/NF-κB signaling pathway, and macrophage polarization toward M1-like macrophages, according to cellular experiments conducted with peripheral neutrophils, BALF cells, and Raw264.7 cells. Moreover, ALI was found to be more severe in Hmox1