Lung Epithelial Differentiation Research Articles

SOX2 and SOX21 in Lung Epithelial Differentiation and Repair.

The lung originates from the ventral foregut and develops into an intricate branched structure of airways, alveoli, vessels and support tissue. As the lung develops, cells become specified and differentiate into the various cell lineages. This process is controlled by specific transcription factors, such as the SRY-related HMG-box genes SOX2 and SOX21, that are activated or repressed through intrinsic and extrinsic signals. Disturbances in any of these processes during the development of the lung may lead to various pediatric lung disorders, such as Congenital Diaphragmatic Hernia (CDH), Congenital Pulmonary Airway Malformation (CPAM) and Broncho-Pulmonary Dysplasia (BPD). Changes in the composition of the airways and the alveoli may result in reduced respiratory function and eventually lead to chronic lung disorders. In this concise review, we describe different intrinsic and extrinsic cellular processes required for proper differentiation of the epithelium during development and regeneration, and the influence of the microenvironment on this process with special focus on SOX2 and SOX21.

ENDOTHELIAL CELLS PROMOTE DISTAL AIRWAY PATTERNING OF HUMAN IPSC-DERIVED LUNG PROGENITORS

Induced pluripotent stem cells (iPSCs) offer unprecedented potential for patient-specific regeneration of tissues and organs. The lung is a vital organ that mediates gas exchange across the alveolar-capillary barrier. Thus, the regeneration of functional lung tissue from iPSCs requires the ability to generate both lung endothelial cells (ECs) and distal type I and II alveolar epithelial cells. Multiple protocols have been developed to specify proximal lung epithelial differentiation from iPSCs; however, the differentiation to a distal lung epithelial phenotype has remained elusive. In light of the importance that endothelial-epithelial cell juxtaposition forms the essential alveolar-capillary barrier, we examined the contribution of iPSC-derived endothelial cells (iECs) in influencing cell fate of de novo lung progenitors (LPs). Human (h) iPSCs were cultured on Matrigel during their differentiation into ECs or LPs. EC differentiation was achieved using combinatorial treatment of hiPSCs with BIO and VEGF. VE-cadherin+ iECs, exhibiting typical endothelial cobblestone morphology, were selected by immnomagnetic isolation followed by expansion, during which conditioned medium (iEC-CM) was collected. Flow cytometric analyses demonstrated CD34, PECAM-1, and VEGFR-2 expression in the VE-cadherin+ population, signifying successful EC differentiation. In vitro lung embryogenesis was recapitulated by generating a definitive endoderm intermediate followed by CXCR4+ immunomagnetic selection. CXCR4+ cells were sequentially exposed to hedgehog, bone morphogenetic proteins, fibroblast growth factors to yield flat NKX2.1+Sox9+ LPs exhibiting a high cytoplasmic to nuclear ratio. Subsequently, LPs were cultured at an air-liquid interface in 50% iEC-CM with daily media changes for 21 days. Quantitative RT-PCR analyses revealed highly significant (#p < 0.01) loss of pluripotency markers (NANOG, OCT4, SOX2) upon differentiation into iECs or LPs. NKX2.1 and SOX9 expressions were ≥15-fold (*p < 0.05) in the LP pool compared to earlier stages of lung development, and notably absent in iECs. Interestingly, LPs cultured in iEC-CM showed a strong bias towards distal rather proximal airway patterning as evidenced by augmented expression (≥3-fold, *p < 0.05) of mature alveolar pneumocyte I and II markers (AQP5, SFTPB, SFTPC); concomitant with reduced (∼60%, *p < 0.05) cilia or goblet cell markers (FOXJ1 and MUC5AC). For the first time we show that ECs play a key role in promoting the differentiation of LP cells to a distal epithelial cell fate that is essential for the formation of the alveolar air-blood barrier. Moreover, this effect is mediated through paracrine mechanisms, likely involving exosome secretion. These findings have profound implications for the development of efficient approaches for the regeneration of functional alveoli.

Significance of Stat3 Signaling in Epithelial Cell Differentiation of Fetal Mouse Lungs.

To study the significance of signal transducer and activator of transcription (Stat) 3 in lung epithelial development of fetal mice, we examined fetal mouse lungs, focusing on the expression of Clara cell secretory protein (CCSP), Forkhead box protein J1 (Foxj1), calcitonin gene-related peptide (CGRP), phosphorylated Stat3 (Tyr705), and hairy/enhancer of split (Hes) 1, and observed cultured fetal lungs upon treatment with IL-6, a Stat3 activator, or cucurbitacin I, a Stat3 inhibitor. Moreover, the interaction of Stat3 signaling and Hes1 was studied using Hes1 gene-deficient mice. Phosphorylated Stat3 was detected in fetal lungs and, immunohistochemically, phosphorylated Stat3 was found to be co-localized in developing Clara cells, but not in ciliated cells. In the organ culture studies, upon treatment with IL-6, quantitative RT-PCR revealed that CCSP mRNA increased with increasing Stat3 phosphorylation, while cucurbitacin I decreased Hes1, CCSP, Foxj1 and CGRP mRNAs with decreasing Stat3 phosphorylation. In the lungs of Hes1 gene-deficient mice, Stat3 phosphorylation was not markedly different from wild-type mice, the expression of CCSP and CGRP was enhanced, and the treatment of IL-6 or cucurbitacin I induced similar effects on mouse lung epithelial differentiation regardless of Hes1 expression status. Stat3 signaling acts in fetal mouse lung development, and seems to regulate Clara cell differentiation positively. Hes1 could regulate Clara cell differentiation in a manner independent from Stat3 signaling.

Wnt and FGF mediated epithelial-mesenchymal crosstalk during lung development.

The adaptation to terrestrial life required the development of an organ capable of efficient air-blood gas exchange. To meet the metabolic load of cellular respiration, the mammalian respiratory system has evolved from a relatively simple structure, similar to the two-tube amphibian lung, to a highly complex tree-like system of branched epithelial airways connected to a vast network of gas exchanging units called alveoli. The development of such an elaborate organ in a relatively short time window is therefore an extraordinary feat and involves an intimate crosstalk between mesodermal and endodermal cell lineages. This review describes the molecular processes governing lung development with an emphasis on the current knowledge on the role of Wnt and FGF signaling in lung epithelial differentiation. The Wnt and FGF signaling pathways are crucial for the dynamic and reciprocal communication between epithelium and mesenchyme during lung development. In addition, some of this developmental crosstalk is reemployed in the adult lung after injury to drive regeneration, and may, when aberrantly or chronically activated, result in chronic lung diseases. Novel insights into how the Wnt and FGF pathways interact and are integrated into a complex gene regulatory network will not only provide us with essential information about how the lung regenerates itself, but also enhance our understanding of the pathogenesis of chronic lung diseases, as well as improve the controlled differentiation of lung epithelium from pluripotent stem cells.

Lung Stem Cell Differentiation in Mice Directed by Endothelial Cells via a BMP4-NFATc1-Thrombospondin-1 Axis

Lung stem cells are instructed to produce lineage-specific progeny through unknown factors in their microenvironment. We used clonal 3D cocultures of endothelial cells and distal lung stem cells, bronchioalveolar stem cells (BASCs), to probe the instructive mechanisms. Single BASCs had bronchiolar and alveolar differentiation potential in lung endothelial cell cocultures. Gain- and loss-of-function experiments showed that BMP4-Bmpr1a signaling triggers calcineurin/NFATc1-dependent expression of thrombospondin-1 (Tsp1) in lung endothelial cells to drive alveolar lineage-specific BASC differentiation. Tsp1 null mice exhibited defective alveolar injury repair, confirming a crucial role for the BMP4-NFATc1-TSP1 axis in lung epithelial differentiation and regeneration invivo. Discovery of this pathway points to methods to direct the derivation of specific lung epithelial lineages from multipotent cells. These findings elucidate a pathway that may be a critical target in lung diseases and provide tools to understand the mechanisms of respiratory diseases at the single-cell level.

Deletion of mesenchymal glucocorticoid receptor attenuates embryonic lung development and abdominal wall closure.

As a member of the nuclear hormone receptor superfamily of ligand-activated transcription factors, the glucocorticoid receptor (GR) is essential for normal embryonic development. To date, the role of mesenchymal glucocorticoid signaling during development has not been fully elucidated. In the present study, we investigated the role of the GR during embryogenesis specifically in mesenchymal tissues. To this aim, we crossed GRflox mice with Dermo1-Cre mice to generate GRDermo1 mice, where the GR gene was deleted within mesenchymal cells. Compared to their wild type littermates, GRDermo1 mice displayed severe pulmonary atelectasis, defects in abdominal wall formation resulting in intestinal herniation, abnormal extracellular matrix synthesis in connective tissues and high postnatal lethality. Lungs of GRDermo1 mice failed to progress from the canalicular to saccular stage, as evidenced by the presence of immature air sacs, thickened interstitial mesenchyme and an underdeveloped vascular network between E17.5 and E18.5. Furthermore, myofibroblasts and vascular smooth muscle cells, although present in normal numbers in GRDermo1 animals, were characterized by significantly reduced elastin synthesis, whilst epithelial lining cells of the immature saccules were poorly differentiated. A marked reduction in normal elastin and collagen deposits were also observed in connective tissues adjacent to the umbilical hernia. This study demonstrates that eliminating the GR in cells of the mesenchymal lineage results in marked effects on interstitial fibroblast function, including a significant decrease in elastin synthesis. This results in lung atelectasis and postnatal lethality, as well as additional and hitherto unrecognized developmental defects in abdominal wall formation. In addition, altered glucocorticoid signaling in the mesenchyme attenuates normal lung epithelial differentiation.

Modulation of endoplasmic reticulum calcium pump expression during lung cancer cell differentiation

Cellular calcium signaling plays important roles in several signal transduction pathways that control proliferation, differentiation and apoptosis. In epithelial cells calcium signaling is initiated mainly by calcium release from endoplasmic-reticulum-associated intracellular calcium pools. Because calcium is accumulated in the endoplasmic reticulum by sarco/endoplasmic reticulum calcium ATPases (SERCA), these enzymes play a critical role in the control of calcium-dependent cell activation, growth and survival. We investigated the modulation of SERCA expression and function in human lung adenocarcinoma cells. In addition to the ubiquitous SERCA2 enzyme, the SERCA3 isoform was also expressed at variable levels. SERCA3 expression was selectively enhanced during cell differentiation in lung cancer cells, and marked SERCA3 expression was found in fully differentiated normal bronchial epithelium. As studied by using a recombinant fluorescent calcium probe, induction of the expression of SERCA3, a lower calcium affinity pump, was associated with decreased intracellular calcium storage, whereas the amplitude of capacitative calcium influx remained unchanged. Our observations indicate that the calcium homeostasis of the endoplasmic reticulum in lung adenocarcinoma cells presents a functional defect due to decreased SERCA3 expression that is corrected during pharmacologically induced differentiation. The data presented in this work show, for the first time, that endoplasmic reticulum calcium storage is anomalous in lung cancer cells, and suggest that SERCA3 may serve as a useful new phenotypic marker for the study of lung epithelial differentiation.

S67 Wnt11 Inhibits TGFb-Induced Epithelial-Mesenchymal Transition in a 3-Dimensional Human Lung Tissue Model

TGFβ1 has been implicated as a key effector in mediating Epithelial-Mesenchymal Transition (EMT), my ofibroblastic transdifferentiation and fibroproliferation in the fibrotic diseases of the lung. ATII cells show high differentiational...

Airway epithelial cell differentiation during lung organogenesis requires C/EBPα and C/EBPβ

CCAAT/enhancer-binding protein (C/EBP)α is crucial for lung development and differentiation of the pulmonary epithelium. Conversely, no lung defects have been observed in C/EBPβ-deficient mice, although C/EBPβ trans-activate pulmonary genes by binding to virtually identical DNA-sequences as C/EBPα. Thus, the pulmonary phenotype of mice lacking C/EBPβ could be explained by functional replacement with C/EBPα. We investigated whether C/EBPα and C/EBPβ have overlapping functions in regulating lung epithelial differentiation during organogenesis. Epithelial differentiation was assessed in mice with a lung epithelial-specific (SFTPC-Cre-mediated) deletion of C/EBPα (Cebpa(ΔLE) ), C/EBPβ (Cebpb(ΔLE) ), or both genes (Cebpa(ΔLE) ; Cebpb(ΔLE) ). Both Cebpa(ΔLE) mice and Cebpa(ΔLE) ; Cebpb(ΔLE) mice demonstrated severe pulmonary immaturity compared to wild-type littermates, while no differences in lung histology or epithelial differentiation were observed in Cebpb(ΔLE) mice. In contrast to Cebpa(ΔLE) mice, Cebpa(ΔLE) ; Cebpb(ΔLE) mice also displayed undifferentiated Clara cells with markedly impaired protein and mRNA expression of Clara cell secretory protein (SCGB1A1), compared to wild-type littermates. In addition, ectopic mucus-producing cells were observed in the conducting airways of Cebpa(ΔLE) ; Cebpb(ΔLE) mice. Our findings demonstrate that C/EBPα and C/EBPβ play pivotal, and partly overlapping roles in determining airway epithelial differentiation, with possible implications for tissue regeneration in lung homeostasis and disease.

Tissue Engineering of Lung: The Effect of Extracellular Matrix on the Differentiation of Embryonic Stem Cells to Pneumocytes

We have previously differentiated lung epithelium from human and murine embryonic stem cells (mESCs) and are now exploring the potential applications of these cells, including in the engineering of lung tissue constructs. In this study, we hypothesized that the differentiation and maintenance of lung epithelium derived from mESCs can be enhanced by extracellular matrix (ECM) proteins. Our established differentiation protocol was applied to mESCs grown on a range of ECMs: collagen I, laminin 332, fibronectin, Matrigel, and, as an experimental control, gelatin. The ECMs were coated onto tissue culture plastic (TCP) and poly-DL-lactic acid (PDLLA), a biodegradable polymer we have previously shown to support the growth of mature pneumocytes. Matrigel or Laminin-332 coating of either TCP or PDLLA film resulted in enhanced surfactant protein C gene expression in differentiating mESCs, a direct indication of the upregulation of lung epithelial differentiation. For each combination, changes in the contact angle and zeta potential of protein-coated TCP and PDLLA film confirmed protein adsorption. We conclude that the choice of the coating protein can greatly affect the differentiation of ESCs, and laminin-332-coated PDLLA provided an ECM-degradable scaffold combination that is suitable for engineering of lung tissue constructs.

Surfactant biology and pulmonary fibrosis: A ChILD shall lead them

ELF5, an Ets family transcription factor found exclusively in epithelial cells, is expressed in the distal lung epithelium during embryogenesis, then becomes restricted to proximal airways at the end of gestation and postnatally. To test the hypothesis that ELF5 represses distal epithelial differentiation, we generated a transgenic mouse model in which a doxycycline inducible HA-tagged mouse Elf5 transgene was placed under the control of the lung epithelium-specific human SFTPC promoter. We found that expressing high levels of ELF5 during early lung development disrupted branching morphogenesis and produced a dilated epithelium. The effects of ELF5 on morphogenesis were stage-dependent, since inducing the transgene on E16.5 had no effect on branching. ELF5 reduced expression of the distal lung epithelial differentiation markers Erm, Napsa and Sftpc, and type II cell ultrastructural differentiation was immature. ELF5 overexpression did not induce the proximal airway epithelial markers Ccsp and Foxj1, but did induce expression of p63, a marker of basal cells in the trachea and esophagus. High ELF5 levels also induced the expression of genes found in other endodermal epithelia but not normally associated with the lung. These results suggest that precise levels of ELF5 regulate the specification and differentiation of epithelial cells in the lung.

Ablation of Lung Epithelial Cells Deregulates FGF‐10 Expression and Impairs Lung Branching Morphogenesis

Epithelial-mesenchymal interactions are essential for tissue patterning during organogenesis. Distal lung epithelium and its adjacent mesenchyme comprise the epithelial-mesenchymal signaling unit that regulates lung branching morphogenesis. Tissue recombination experiments have demonstrated the importance of mesenchymal signals in inducing lung epithelial differentiation and branching, but the role of the epithelium in regulating mesenchymal signals has not been well characterized. Using transgenic mice, we ablated distal lung epithelial cells during lung development by inducing the expression of a constitutively active proapoptotic Bax protein under the surfactant protein C (SP-C) promoter. We found that epithelial cell ablation results in impaired lung branching morphogenesis, which progresses to emphysematous airspaces in the adults. Mesenchymal expression of fibroblast growth factor 10 (Fgf-10), whose strict spatial and temporal expression is critical for proper lung branching morphogenesis, is disrupted and loses its localized pattern. Interestingly, the expression of sonic hedgehog (Shh), an epithelial gene known to modulate Fgf-10 expression, is unchanged, indicating the existence of other distal epithelial signals that regulate mesenchymal Fgf-10expression. We propose that distal SP-C expressing lung epithelial cells provide essential signals for the downregulation of Fgf-10 expression in the distal mesenchyme during lung development. 292:123-130, 2009. (c) 2008 Wiley-Liss, Inc.

Misexpression of ELF5 disrupts lung branching and inhibits epithelial differentiation

ELF5, an Ets family transcription factor found exclusively in epithelial cells, is expressed in the distal lung epithelium during embryogenesis, then becomes restricted to proximal airways at the end of gestation and postnatally. To test the hypothesis that ELF5 represses distal epithelial differentiation, we generated a transgenic mouse model in which a doxycycline inducible HA-tagged mouse Elf5 transgene was placed under the control of the lung epithelium-specific human SFTPC promoter. We found that expressing high levels of ELF5 during early lung development disrupted branching morphogenesis and produced a dilated epithelium. The effects of ELF5 on morphogenesis were stage-dependent, since inducing the transgene on E16.5 had no effect on branching. ELF5 reduced expression of the distal lung epithelial differentiation markers Erm, Napsa and Sftpc, and type II cell ultrastructural differentiation was immature. ELF5 overexpression did not induce the proximal airway epithelial markers Ccsp and Foxj1, but did induce expression of p63, a marker of basal cells in the trachea and esophagus. High ELF5 levels also induced the expression of genes found in other endodermal epithelia but not normally associated with the lung. These results suggest that precise levels of ELF5 regulate the specification and differentiation of epithelial cells in the lung.

Stage-specific Effects of cAMP Signaling during Distal Lung Epithelial Development

cAMP signaling is postulated to play a role in distal lung epithelial differentiation based on several observations. First, it enhances fibroblast growth factor-induced transdifferentiation of early tracheal epithelium into respiratory epithelium. Second, there are cAMP-responsive elements in the heterologous promoters of Sftpb and Sftpa genes. Third, cAMP augments the effect of dexamethasone in maintaining differentiation of human fetal type II pneumocyte culture. However, this concept has not been thoroughly tested in vivo. In the current study, we modulated cAMP signaling in developing distal lung epithelium in vivo using an inducible transgenic system that expressed a mutant form of Galpha(s) (Galpha(s)Q227L). We failed to demonstrate the ability of cAMP to promote distal epithelial maturation during embryonic stages. The results argue against its physiological role in this process. In addition, induction of cAMP signaling at the late pseudoglandular stage but not during the canalicular or saccular stage surprisingly delayed distal differentiation by suppressing the expression of Sftpc, Sftpa, and Aquaporin5 as well as the formation of lamellar bodies. This stage-specific inhibitory effect was observed in the absence of cellular toxicity or changes in branching. Transgenic lungs did not show significant changes in the known pathways that are important for distal differentiation. Therefore, we propose the existence of yet-to-be identified cAMP-sensitive novel regulators of early distal lung epithelial differentiation. Although the delay of differentiation seemed to be reversible at later stages, it still led to pronounced permanent postnatal airspace enlargement due to impaired paracrine function of distal epithelium in regulating alveolar myofibroblast development.

Loss of PECAM-1 Function Impairs Alveolarization

The final stage of lung development in humans and rodents occurs principally after birth and involves the partitioning of the large primary saccules into smaller air spaces by the inward protrusion of septae derived from the walls of the saccules. Several observations in animal models implicate angiogenesis as critical to this process of alveolarization, but all anti-angiogenic treatments examined to date have resulted in endothelial cell (EC) death. We therefore targeted the function of platelet endothelial cell adhesion molecule, (PECAM-1), an EC surface molecule that promotes EC migration and has been implicated in in vivo angiogenesis. Administration of an anti-PECAM-1 antibody that inhibits EC migration, but not proliferation or survival in vitro, disrupted normal alveolar septation in neonatal rat pups without reducing EC content. Three-dimensional reconstruction of lungs showed that pups treated with a blocking PECAM-1 antibody had remodeling of more proximal branches resulting in large tubular airways. Subsequent studies in PECAM-1-null mice confirmed that the absence of PECAM-1 impaired murine alveolarization, without affecting EC content, proliferation, or survival. Further, cell migration was reduced in lung endothelial cells isolated from these mice. These data suggest that the loss of PECAM-1 function compromises postnatal lung development and provide evidence that inhibition of EC function, in contrast to a loss of viable EC, inhibits alveolarization.

BMP4 modulates fibroblast growth factor-mediated induction of proximal and distal lung differentiation in mouse embryonic tracheal epithelium in mesenchyme-free culture.

Lung morphogenesis and differentiation require interaction between the epithelium and mesenchyme, which is mediated by diffusible molecules such as fibroblast growth factors (FGFs), bone morphogenetic protein 4 (BMP4), and Shh. We have used mesenchyme-free culture to study the effects of these molecules on lung epithelial differentiation. We have tested the individual abilities of FGF1, FGF2, FGF7, FGF9, FGF10, and FGF18, as well as BMP4 and Shh to promote growth and specify distal lung differentiation in mouse tracheal epithelium. The different FGFs exhibited distinct abilities to induce epithelial growth and the expression of the distal lung epithelial marker, surfactant protein C (SP-C), although all FGFs were able to induce expression of BMP4. Tracheal epithelium treated with FGF10 showed little growth and failed to express SP-C as measured by whole-mount in situ hybridization and quantitative real-time polymerase chain reaction. FGF1 treatment resulted in the strongest induction of SP-C. Treatment with BMP4 inhibited epithelial growth and differentiation and antagonized the stimulatory effects of FGF1. In contrast, inhibition of endogenous BMP4 signaling with Noggin protein did not inhibit growth or expression of SP-C but did increase the expression of the proximal lung markers CCSP and HFH4. Expression of Shh was not affected by any of the conditions tested. These results suggest that BMP4 does not signal epithelial cells to adopt a distal fate but may regulate the expansion of proximal epithelial cells in the lung.

Induction of alveolar type II cell differentiation in embryonic tracheal epithelium in mesenchyme-free culture.

We have previously shown that fetal lung mesenchyme can reprogram embryonic rat tracheal epithelium to express a distal lung phenotype. We have also demonstrated that embryonic rat lung epithelium can be induced to proliferate and differentiate in the absence of lung mesenchyme. In the present study we used a complex growth medium to induce proliferation and distal lung epithelial differentiation in embryonic tracheal epithelium. Day-13 embryonic rat tracheal epithelium was separated from its mesenchyme, enrobed in growth factor-reduced Matrigel, and cultured for up to 7 days in medium containing charcoal-stripped serum, insulin, epidermal growth factor, hepatocyte growth factor, cholera toxin, fibroblast growth factor 1 (FGF1), and keratinocyte growth factor (FGF7). The tracheal epithelial cells proliferated extensively in this medium, forming lobulated structures within the extracellular matrix. Many of the cells differentiated to express a type II epithelial cell phenotype, as evidenced by expression of SP-C and osmiophilic lamellar bodies. Deletion studies showed that serum, insulin, cholera toxin, and FGF7 were necessary for maximum growth. While no single deletion abrogated expression of SP-C, deleting both FGF7 and FGF1 inhibited growth and prevented SP-C expression. FGF7 or FGF1 as single additions to the medium, however, were unable to induce SP-C expression, which required the additional presence of serum or cholera toxin. FGF10, which binds the same receptor as FGF7, did not support transdifferentiation when used in place of FGF7. These data indicate that FGF7 is necessary, but not sufficient by itself, to induce the distal rat lung epithelial phenotype, and that FGF7 and FGF10 play distinct roles in lung development.

Proliferation and differentiation of fetal rat pulmonary epithelium in the absence of mesenchyme.

Previous studies have shown that pulmonary mesenchyme is required to maintain epithelial viability and to support branching morphogenesis and cytodifferentiation. We have examined whether pulmonary mesenchyme can be replaced by a medium containing a combination of soluble factors. Day 13-14 fetal rat distal lung epithelium was enzymatically separated from its mesenchyme, enrobed in EHS tumor matrix, and cultured for 5 d in medium containing concentrated bronchoalveolar lavage, EGF, acidic fibroblast growth factor, cholera toxin, insulin, and FBS (TGM), or in control medium containing only FBS. After 5 d in culture, marked growth and morphological changes occurred in epithelial rudiments cultured in TGM, whereas no changes were seen in controls. [3H]Thymidine incorporation and nuclear labeling indices during the last 24 h of culture confirmed that epithelial rudiments cultured in TGM had significant proliferative capacities. Evaluation of surfactant protein gene expression by Northern analysis, in situ hybridization, and immunocytochemistry demonstrated that distal lung epithelial differentiation progressed in TGM. Ultrastructural analysis demonstrated that fetal distal lung epithelium cultured in TGM contained lamellar bodies and deposited a basal lamina. These results are the first demonstration that sustained proliferation and differentiation of glandular stage distal pulmonary epithelium can proceed in the absence of mesenchyme.