Although theophylline has been used in the treatment of lung diseases, particularly bronchial asthma, since the nineteenth century, the mechanisms underlying its effectiveness remained poorly understood until quite recently. The identification of cyclic nucleotide phosphodiesterase (PDE)--the enzyme responsible for breaking down cyclic AMP and cyclic GMP within cells--as a target for methylxanthines such as theophylline led to a research effort that has resulted in the characterization of multiple forms of the PDE enzyme and the development of selective inhibitors for some of these forms. Using these drugs, it has been possible to identify the PDE "isoenzymes" in a number of tissues and cells and to demonstrate the functional effects of the inhibition of different PDEs upon these tissues. Studies on the smooth muscle of human airways and pulmonary arteries have identified isoenzyme-selective PDE inhibitors that are effective broncho- and vasorelaxants in vitro, and it is hoped that these agents may be effective in relieving airway obstruction and pulmonary hypertension in patients. In addition, selective inhibitors of certain PDE isoenzymes suppress the proinflammatory functions of a range of immune cells, including the lung mast cell and the alveolar macrophage. Selective inhibitors of PDE isoenzymes are beginning to undergo clinical trials for the treatment of asthma. The advancing understanding of the PDE distribution in the lung and the ever more precise characterization of distinct enzyme proteins should allow the development of site-selective drugs for the treatment of lung diseases, while minimizing the systemic side effects associated with nonselective PDE inhibitors such as theophylline.