Administration of glucagon has been shown to decrease pulmonary vascular resistance, but its primary site of action is undetermined. Whether this is on the arterial or venous side of the capillary would be reflected in the microvascular hydrostatic pressure. We used the pulmonary flow of lymph, a sensitive index of the transvascular fluid filtration rate, to monitor the microvascular hydrostatic pressure. Eight unanesthetized sheep with a surgically created long-term fistula for monitoring pulmonary lymph were given a 3-mg bolus of glucagon after a baseline period. We found no change in pulmonary arterial or left atrial pressures but noted a significant increase in cardiac output and a decrease in pulmonary resistance. The flow of pulmonary lymph increased by 50 percent for 30 minutes after administration of glucagon, and the protein content of the lymph decreased by 15 percent, indicating a large increase in the microvascular hydrostatic pressure. From these data, we calculated a decrease in arterial resistance from 60 percent to 30 percent of the total and, subsequently, an increase of 6 cm H2O in the microvascular hydrostatic pressure. Administration of glucagon, therefore, decreases the arterial resistance while increasing microvascular pressure in the process.