Since cortisol (F) can influence fetal lung maturation, alterations in its intracellular metabolism may be important. In fetal lung at midgestation, both the in vivo studies of Pasqualini et al. and the in vitro studies of Murphy showed the activity of the enzyme 11 beta-hydroxysteroid dehydrogenase (EC 1.1.1.146) to be strongly oxidative, converting F to its inactive analog cortisone (E). By contrast, Smith et al. observed only reductive activity (E to F) in monolayer cultures. The object of this study was to resolve this discrepancy. Human fetal lung (HFL) of gestational age 9-13 weeks was grown in monolayer cultures or as explants on grids in Ham's F-10 medium plus 10% fetal calf serum and [3H]F and [14C]E (12-20 ng/ml of each). Extracts of media were chromatographed to separate the steroids, and the percent conversion was calculated. Explants converted F to E 20-40% and maintained day 1 levels for at least 7 days of culture. E to F conversion was initially low (1-5%) and rose to 14-20% by the end of culture, corresponding to fibroblast-like outgrowth. In monolayer cultures, which appeared to consist almost entirely of fibroblast-like cells, F to E conversion was less than 10% by 5 days, while E to F conversion steadily increased to 20-85% and plateaued at confluence. Homogenates of fresh tissue demonstrated F to E but no E to F conversion, even in the presence of cofactors. Thus, it appears that when tissue structure is maintained as in the explants, HFL cells oxidize F to E by a unidirectional enzyme; activation of E to F is only expressed by HFL fibroblast-like cells in culture and does not reflect the in vivo situation.