M1 macrophage polarization plays a pivotal role in inflammation-related diseases. However, the endogenous regulatory factors and mechanisms underlying M1 macrophage polarization have not been entirely clarified. This study aimed to explore whether endogenous sulfur dioxide (SO2) is involved in M1 macrophage polarization and its mechanism. In the study, we found that the endogenous SO2/aspartate aminotransferase1 (AAT1) pathway was downregulated during M1 polarization of macrophages induced by lipopolysaccharide (LPS) stimulation, and supplementation with SO2 donors or AAT1 overexpression restored SO2 content, suppressed protein expression of inducible nitric oxide synthase, restrained mRNA level of M1 phenotype-related genes tumor necrosis factor α, interleukin-1β and interleukin-12β and decreased the CD86 expression. In addition, AAT1-knockdowned macrophages exhibited reduced level of hypoxia-inducible factor-1α (HIF-1α) hydroxylation, elevated HIF-1α protein level, and polarization into M1-type, while supplementation with SO2 reversed the above effects. Mechanistically, SO2 maintained prolyl hydroxylase (PHD) activity in a thiol-dependent manner. SO2 maintained PHD2 activity by sulphenylating PHD2 at Cys260, thereby reducing HIF-1α protein levels and subsequently inhibiting M1 macrophage polarization. Besides, SO2 enhanced PHD2 sulphenylation, inhibited M1 macrophage polarization, and alleviated lung damage in a mouse model of LPS-induced acute lung injury. These results suggested that downregulation of the endogenous SO2/AAT1 pathway was a pivotal mechanism for M1 macrophage polarization. SO2 maintained PHD2 activity via sulphenylation of Cys260, and promoted HIF-1α hydroxylation and degradation, thereby impeding M1 macrophage polarization.