Intact fetal hamster lungs were taken for culture on gestational day 12, when only lobar bronchi and primary bronchioles are established and the epithelial cells are undifferentiated. Explants were maintained on Transwell collagen membranes for 2 and 4 days in BGJb medium alone, with 5% FBS, or with the following additives: insulin, transferrin, hydrocortisone, cholera toxin, EGF, and vitamin A. Development of the respiratory tree was affected differently by each medium formulation. BGJb medium with 5% FBS permitted near normal branching of airways and presumptive alveoli. In contrast, BGJb medium alone permitted only limited branching of these structures. BGJb medium with additives permitted branching but markedly altered normal development. The differentiation of endocrine and secretory cells was monitored by immunolabeling for serotonin and calcitonin gene-related peptide, and Clara cell protein, respectively. Ciliated cells were identified by morphology. All medium formulations supported the timely differentiation of endocrine, secretory, and ciliated cells. The ultimate goal of our studies is to characterize factors that influence airway branching and cytodifferentiation during fetal lung development. This study showed that near normal airway branching and cytodifferentiation were supported in vitro by BGJb medium with 5% FBS. Although cytodifferentiation occurred with the two other formulations, airway development was impaired.