Clara cells and type II pneumocytes are the progenitor cells of the bronchioles and alveoli, respectively. These peripheral airway cells (PAC) contain characteristic cytoplasmic structures and express surfactant associated proteins. PAC cell markers are expressed by many pulmonary adenocarcinomas having papillary and/or lepidic growth patterns, which are characteristics of the bronchioloalveolar and papillary subtypes. We investigated the expression of PAC markers in a panel of 41 lung cancer cell lines. Ultrastructural studies demonstrated the presence of cytoplasmic structures characteristic of Clara cells or of type II pneumocytes in 9 of 34 (26%) non-small cell lung cancer cell lines, including 7 of 17 (41%) adenocarcinomas, one squamous cell carcinoma, and one large cell carcinoma. Of interest, the cytoplasmic structures were present in 5 of 6 (83%) cell lines initiated from papillolepidic adenocarcinomas. In addition, we examined the lines for expression of the surfactant associated proteins SP-A, SP-B, and SP-C. Eight of the nine cell lines containing cytoplasmic inclusions characteristic of PAC cells also expressed protein and/or RNA of SP-A, the major surfactant associated protein. Five of these lines expressed SP-B RNA (either constitutively or after dexamethasone induction), while a single line expressed SP-C only after dexamethasone induction. None of six small cell lung cancer cell lines examined expressed any of the PAC markers. Thus, PAC markers are expressed frequently (but not exclusively) in pulmonary adenocarcinoma cell lines, especially in those initiated from tumors having papillolepidic growth patterns. The establishment and identification of multiple cell lines expressing PAC features provide an important new resource for biological and preclinical therapeutic studies.