Hypersensitivity pneumonia is a form of diffuse interstitial lung disease resulting from sensitization to an inhaled antigen. Clinical and radiological features are relatively nonspecific, overlapping significantly with other forms of diffuse interstitial lung disease. Establishing the diagnosis in the absence of lung biopsy is challenging and is heavily dependent on being able to identify a specific antigenic exposure. Lung biopsy is especially important in diagnosing hypersensitivity pneumonia in patients for whom no incriminating exposure has been elucidated. Surgical lung biopsies show a classical combination of findings in the majority of patients, which include an airway-centered, variably cellular chronic interstitial pneumonia, a lymphocyte-rich chronic bronchiolitis, and poorly formed non-necrotizing granulomas distributed mainly within the peribronchiolar interstitium. The bronchiolitis may include variable degrees of peribronchiolar fibrosis and hyperplasia of the bronchiolar epithelium ('peribronchiolar metaplasia'), a characteristic but a nonspecific finding. In some patients, granulomatous inflammation may be lacking, resulting in a histological appearance resembling nonspecific interstitial pneumonia. Late-stage fibrotic hypersensitivity pneumonia results in clinical, radiological, and histological findings that closely mimic usual interstitial pneumonia. The presence of established collagen fibrosis, especially when associated with architectural distortion in the form of honeycomb change, is associated with shorter survivals.