Bombesin (BN) or its mammalian counterpart, Gastrin-releasing peptide (GRP) is produced by pulmonary neuroendocrine cells (PNEC). The function of GRP as a growth factor involves lung morphogenesis, but the precise mechanism and the target cells have not been defined. We used a nonradioactive in situ hybridization (NISH) and Northern blot analysis for both GRP receptor (GRP-R) and its ligand GRP on samples of fetal and newborn human and rabbit lung. For immunolocalization of BN/GRP and the proliferating lung cell population we used anti-BN/GRP or MIB-1 antibodies, respectively. NISH and Northern blot showed peak expression of GRP-R mRNA on day 24 gestation in the fetal rabbit lung. At the cellular level, GRP-R mRNA was localized mainly in the distal airway epithelial tubes and surrounding mesenchyme, whereas proximal airways showed decreased signal. Epithelium expressing GRP-R showed positive labeling for proliferation antigen in contrast to PNEC, which were negative. In human post-natal lung, strong signal for GRP-R mRNA was localized in the airway epithelial cells and submucosal glands. PNEC in both rabbit and human lung expressed mRNA for GRP, but only in human lung were they immunoreactive for the peptide. However BN/GRP immunoreactive cells were detected in rabbit fetal lung culture. The expression of GRP-R in mammalian lung is developmentally regulated, peaking both spatially and temporally during the phase of rapid airway growth and differentiation. Both epithelial and mesenchymal components express GRP-R consistent with paracrine mechanism for GRP activity during lung morphogenesis.