Recently generated caveolin-1 deficient mice (cav-1^-/-) display several physiological alterations such as severe heart failure and lung fibrosis. The molecular mechanisms how the loss of caveolin-1 (cav-1) mediates these alterations are currently under debate. A plethora of studies support a role of cav-1 as a negative regulator of endothelial nitric oxide synthase (eNOS). Accordingly, constitutive eNOS hyperactivation was observed in cav-1^-/-. Given the hyperactivated eNOS enzyme we hypothesized that disturbed eNOS function is involved in the development of the cardiopulmonary pathologies in cav-1^-/-. The present study argues that loss of cav-1 results in enhanced eNOS activity but not in increased vascular tetrahydrobiopterin (BH₄) levels (which acts as an essential eNOS cofactor) thereby causing a stoichiometric discordance between eNOS activity and BH₄ sufficient to cause dysfunctional eNOS signaling. The resultant oxidative stress is largely responsible for major cardiac and pulmonary defects observed in cav-1^-/-. BH₄ donation to cav-1^-/- led to a normalized BH₄/BH₂ ratio, to reduced oxidant stress, to substantial improvements of both systolic and diastolic heart function and to marked amelioration of the impaired lung phenotype. Notably, the antioxidant tetrahydroneopterin which is not essential for eNOS function showed no relevant effect. Taken together these novel findings indicate that dysfunctional eNOS is of central importance in the genesis of the cardiopulmonary phenotype of cav-1^-/-. Additionally, these findings are generally of paramount importance since they underline the deleterious role of an uncoupled eNOS in cardiovascular pathology and they additionally suggest BH₄ as an effective cure.