Pulmonary surfactant is a developmentally-regulated lipoprotein synthesized and secreted by the type II cells of the pulmonary alveolus where surfactant glycerophospholipids and proteins act to reduce surface tension at the alveolar air-liquid interface. Surfactant protein A (SP-A), the major surfactant-associated protein, appears to serve an important role in surfactant function and reutilization by type II cells. SP-A synthesis and gene expression are initiated in fetal lung tissue in concert with the developmental induction of surfactant glycerophospholipid synthesis. In studies using midtrimester human fetal lung explants maintained in organ culture, we have observed that cyclic AMP and glucocorticoids have pronounced effects on morphologic development and on the levels of SP-A gene expression. Cyclic AMP analogues act primarily to induce SP-A gene transcription; whereas, glucocorticoids have complex effects at both the transcriptional and posttranscriptional levels. We also have found that human fetal lung in vitro secretes into the culture medium relatively large amounts of prostaglandins (PG) PGE2 and PGF2 alpha and the PGI2 and thromboxane A2 metabolites, 6-keto-PGF1 alpha and TxB2, respectively. The prostaglandin synthesis inhibitor, indomethacin, markedly inhibits SP-A gene expression and cyclic AMP formation by human fetal lung in culture; the inhibitory effect of indomethacin on SP-A gene expression can be prevented by simultaneous incubation with either Bt2cAMP or PGE2. These findings are suggestive that prostaglandins acting through cyclic AMP also may serve an important role in the regulation of SP-A gene expression in human fetal lung tissue.