MicroRNAs are a family of small noncoding RNAs that regulate the expression of their target proteins at the posttranscriptional level. Their functions cover almost every aspect of cell physiology. However, the roles of microRNAs in fetal lung development are not completely understood. The objective of this study is to investigate the regulation and molecular mechanisms of alveolar epithelial cell maturation during fetal lung development by miR-124. We discovered that miR-124 was downregulated during rat fetal lung development and predominantly expressed in the epithelial cells at late stage of the lung development. Overexpression of miR-124 with an adenovirus vector led to the inhibition of epithelial maturation in rat fetal lung organ cultures and fetal alveolar epithelial type II cells, as demonstrated by a decrease in the type II cell marker expression and an increase in glycogen content. We further demonstrated by luciferase reporter assays that miR-124 inhibited the NF-κB, cAMP/PKA, and MAPK/ERK pathways. In addition, nuclear factor I/B (NFIB), a critical protein in fetal lung maturation, was validated as a direct target of miR-124. Furthermore, miR-124 expression was induced by the Wnt/β-catenin signaling pathway through a direct interaction of LEF1 and the miR-124 promoter region. We concluded that miR-124 downregulation is critical to fetal lung epithelial maturation and miR-124 inhibits this maturation process at least partially through the inhibition of NFIB.