In 50 of 94 patients with bronchiolitis obliterans we found no apparent cause or associated disease, and the bronchiolitis obliterans occurred with patchy organizing pneumonia. Histologic characteristics included polypoid masses of granulation tissue in lumens of small airways, alveolar ducts, and some alveoli. The fibrosis was uniform in age, suggesting that all repair had begun at the same time. The distribution was patchy, with preservation of background architecture. Clinically, there was cough or flu-like illness for 4 to 10 weeks, and crackles were heard in the lungs of 68 per cent of the patients. Radiographs showed an unusual pattern of patchy densities with a "ground glass" appearance in 81 per cent. Physiologically, there was restriction in 72 per cent of the patients, and 86 per cent had impaired diffusing capacity. Obstruction was limited to smokers. The mean follow-up period was four years. With corticosteroids, there was complete clinical and physiologic recovery in 65 per cent of the subjects; two died from progressive disease. This disorder differs from bronchiolitis obliterans with irreversible obstruction. It was confused most often with idiopathic pulmonary fibrosis. In view of the benign course and therapeutic response, a histologic distinction is important.