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Abstract Prostaglandin D2 (PGD2) signals via the DP1 and DP2 receptors. In Phase II trials, DP2 antagonism decreased airway inflammation and airway smooth muscle (ASM) area in moderate-to-severe asthma patients. However, in Phase III, DP2 antagonism failed to lower the rate of exacerbations, and DP2 as a target was shelved. Here, using a preclinical model of chronic experimental asthma, we demonstrate that rhinovirus-induced exacerbations increase PGD2 release, mucus production, transforming growth factor (TGF)-β1 and type-2 inflammation. DP2 antagonism or DP1 agonism ablates these phenotypes, increases epithelial EGF expression and decreases ASM area via increased IFN-γ. In contrast, dual DP1-DP2 antagonism or dual corticosteroid/DP2 antagonism, which attenuates endogenous PGD2, prevented ASM resolution. We demonstrate that DP2 antagonism resolves ASM remodelling via PGD2/DP1-mediated upregulation of IFN-γ expression, and that dual DP2 antagonism/corticosteroid therapy, as often occurred in the human trials, impairs the efficacy of DP2 antagonism by suppressing endogenous PGD2 and IFN-γ production.