Carbon nanotubes (CNTs) are a class of new allotrope of carbon. Different functionalized CNTs may vary from their physical and chemical properties to the biological property. In this study, the toxicity of water-soluble taurine multi-walled CNTs (tau-MWNTs), raw MWNTs and positive control crystalline silicon dioxide particles on mouse lungs via intratracheal instillation (i.t.) was investigated. The dosages we used were 0.125, 0.25, 0.5 or 1 mg/kg of tau-MWNTs and raw MWNTs, and 1 mg/kg of silicon dioxide particles; Serum and lungs were collected at 1, 7, 14 or 28 days postexposure. The biochemical and cellular parameters were assessed, which include the ratio of the lung weight and body weight (lung indices), lactate dehydrogenase (LDH), alkaline phosphatase (ALP) and angiotensin converting enzyme (ACE) in serum, and malondialdehyde (MDA), reduced glutathione (GSH), total sulfhydryl group (TSH) in lung tissue homogenates as well as the hydroxyproline in lungs. The characteristic recovery of the lung injury at 28 days postexposure was examined by the assessment of LDH, ALP, lung indices, and histopathology. ACE, MDA, GSH, TSH and histopathological changes showed that tau-MWNTs were less toxic than the raw MWNTs. Histopathological and ultrastructural investigation indicated that the acute pulmonary inflammation in lungs alleviated after 7d postexposure, and were greatly recovered within 28d. Meanwhile, the entrapment of tau-MWNTs reduced greatly by the 28d postexposure. Whereas the heavier pathologic changes induced by raw MWNTs lasted 7 days more than that of tau-MWNTs. Notably, no occurrence of granulomas and fibrosis were found in this study both in the two CNTs samples through 28d postexposure. Silicon dioxide particles, on the contrary, produced more severe damage to lungs than CNTs did in lung index, as well as other biochemical and cellular parameters. These findings indicate that water-soluble tau-MWNTs in low and medium doses induce slight and recoverable pulmonary inflammation in mice, and are less toxic than the insoluble raw MWNTs.