We have developed a short-term organ culture model for the study of the biochemical and morphological development of late gestation fetal rat lung. Explants (1 mm3) of 19-day lung were cultured in an oxygen enriched environment in the presence of synthetic serum-free medium for 3 days. Morphological maturation continued in culture. The rate of incorporation of choline into disaturated phosphatidylcholine and the content of this phospholipid in the explants increased in vitro in a pattern very similar to that which occurs in vivo. The activities of choline kinase and cholinephosphotransferase were also similar in cultured lung and in vivo. Studies of glucose oxidation to CO2 provided additional evidence that the explants remained viable in culture. The explants retained the sensitivity of fetal lung to hormonal action. This was demonstrated by the stimulation of choline incorporation into phospholipid by cyclic AMP and an increase in the glycogen content after exposure to insulin.