Glycoprotein nonmetastatic melanoma protein B (GPNMB), a transmembrane protein, has been reported to have an important role in tissue repair and angiogenesis. Recently, we have demonstrated that hyperoxia exposure down-regulates microRNA (miR)-150 expression and concurrent induction of its target gene, GPNMB, in neonatal rat lungs. This study aimed to test the hypothesis that soluble GPNMB (sGPNMB) promotes angiogenesis in the hyperoxic neonatal lungs. Wild-type (WT) or miR-150 knockout (KO) neonates, exposed to 95% O2 for 3, 6, and 10 days, were evaluated for lung phenotypes, GPNMB protein expression in the lungs, and sGPNMB levels in the bronchoalveolar lavage. Angiogenic effects of sGPNMB were examined both in vitro and in vivo. After a 6-day exposure, similar analyses were performed in WT and miR-150 KO neonates during recovery at 7, 14, and 21 days. miR-150 KO neonates displayed an increased capillary network, decreased inflammation, and less alveolar damage compared with WT neonates after hyperoxia exposure. The early induction of GPNMB and sGPNMB were found in miR-150 KO neonates. The recombinant GPNMB, which contained a soluble portion of GPNMB, promoted endothelial tube formation in vitro and enhanced angiogenesis in vivo. The increased capillaries in the hyperoxic lungs of miR-150 KO neonates appeared dysmorphic. They were abnormally enlarged in size and occasionally laid at subepithelial regions in the alveoli. However, the lung architecture returned to normal during recovery, suggesting that abnormal vascularity during hyperoxia does not affect postnatal lung development. GPNMB plays an important role in angiogenesis during hyperoxia injury. Treatment with GPNMB may offer a novel therapeutic approach in reducing pathologic complications in bronchopulmonary dysplasia.