The clinical outcome in ARDS patients improved with the introduction of low tidal volume (TV) ventilation. Thus, our objective was to determine why low TV ventilation induced lung fluid absorption in preterm guinea pigs at risk of developing respiratory distress. We ventilated preterm guinea pigs at 66–68 days gestation with low TV (6 ml/kg) and compared with traditional TV (12 ml/kg). Low TV ventilation resulted in a 23 ± 10% (±SD) distal lung fluid absorption, which when compared to −1 ± 3% in conventional TV ventilated fetuses appeared as an induction of fluid absorption. The increased distal lung fluid absorption in low TV ventilated fetuses was associated with an increased αENaC mRNA. We also measured serum and glucocorticoid‐regulated kinase‐1 (SGK1) and Na, K ATPase and correlated changes in SGK1 expression to induction of lung fluid absorption. αENaC and Na,K ATPase expression were both induced when SGK‐1 was elevated. Thus, our data suggest that low TV ventilation increases fetal lung fluid absorption by SGK1‐dependent ENaC regulation. (Funded by March of Dimes Birth Defects Foundation Research Grant No. 6‐FY03‐64 (HGF); Travel award from Peter K. Lauf Student Travel Scholarship (SK)