The pathological hallmarks of bronchopulmonary dysplasia (BPD), a chronic lung disease of premature infants, include inflammation, arrested alveolarization, and dysregulated angiogenesis. Severe BPD is often complicated by pulmonary hypertension (PH) that significantly increases morbidity and mortality. Glycogen synthase kinase (GSK)-3β plays a pivotal role in embryonic development, cell proliferation and survival, and inflammation by modulating multiple signaling pathways, particularly the nuclear transcription factor, NF-κB, and Wnt/β-catenin pathways. Aberrant GSK-3β signaling is linked to BPD. We tested the hypothesis that inhibition of GSK-3β is beneficial in preventing hyperoxia-induced neonatal lung injury, an experimental model of BPD. Newborn rats were exposed to normoxia or hyperoxia (90% oxygen), and received daily intraperitoneal injections of placebo (DMSO) or SB216763, a specific pharmacological inhibitor of GSK-3β, for 14 days. Hyperoxia exposure in the presence of the placebo increased GSK-3β phosphorylation, which was correlated with increased inflammation, decreased alveolarization and angiogenesis, and increased pulmonary vascular remodeling and PH. However, treatment with SB216763 decreased phosphorylation of NF-κB p65, expression of monocyte chemotactic protein-1, and lung inflammation during hyperoxia. Furthermore, treatment with the GSK-3β inhibitor also improved alveolarization and angiogenesis, and decreased pulmonary vascular remodeling and PH. These data indicate that GSK-3β signaling plays an important role in the pathogenesis of hyperoxia-induced neonatal lung injury, and that inhibition of GSK-3β is beneficial in preventing inflammation and protecting alveolar and vascular structures during hyperoxia. Thus, targeting GSK-3β signaling may offer a novel strategy to prevent and treat preterm infants with BPD.