To determine potential relationships between transforming growth factor (TGF)-alpha and surfactant homeostasis, the metabolism, function, and composition of surfactant phospholipid and proteins were assessed in transgenic mice in which TGF-alpha was expressed in respiratory epithelial cells. Secretion of saturated phosphatidylcholine was decreased 40-60% by expression of TGF-alpha. Although SP-A, SP-B, and SP-C mRNA levels were unchanged by expression of TGF-alpha, SP-A and SP-B content in bronchoalveolar lavage fluid was decreased. The minimum surface tension of surfactant isolated from the transgenic mice was significantly increased. Incubation of cultured normal mice type II cells with TGF-alpha in vitro did not change secretion of surfactant phosphatidylcholine and SP-B, indicating that TGF-alpha does not directly influence surfactant secretion. Expression of a dominant negative (mutant) EGF receptor in the respiratory epithelium blocked the TGF-alpha-induced changes in lung morphology and surfactant secretion, indicating that EGF receptor signaling in distal epithelial cells was required for TGF-alpha effects on surfactant homeostasis. Because many epithelial cells were embedded in fibrotic lesions caused by TGF-alpha, changes in surfactant homeostasis may at least in part be influenced by tissue remodeling that results in decreased surfactant secretion. The number of nonembedded type II cells was decreased 30% when TGF-alpha was expressed during development and was increased threefold by TGF-alpha expression in adulthood, suggesting possible alteration of type II cells on surfactant metabolism in the adult lung. Abnormalities in surfactant function and decreased surfactant level in the airways may contribute to the pathophysiology induced by TGF-alpha in both the developing and adult lung.