The stimulation and maintenance of the pulmonary alveolar type II cell's capacity to biosynthesize, store, and secrete surfactant proteins (SPs) are modulated to a great extent by growth factors, extracellular matrix (ECM) components, and hormones. It is possible that differences in ECM composition, as exist between type I and II cells normally or as might occur with excessive cell surface shedding during inflammation or injury states, may specifically alter SP expression. Here, isolated type II cells were exposed to the model sulfated ECM heparin, de-sulfated heparin and/or FGF-1, -2 or -7 for 24 h to examine by quantitative real time polymerase chain reaction (qRT-PCR) their effects on SP gene expression. Aquaporin 5 (AQP-5) gene expression was also examined as a phenotypic marker for the type I cell. SP-B mRNA abundance was increased 4- to 8-fold by all three FGFs. Heparin at low concentrations (5 µg/mL) or de-sulfated heparin at high concentrations (500 µg/mL) enhanced the effects of FGF-2 and -7, while high heparin concentrations (500 µg/mL) were inhibitory. In contrast, SP-B mRNA abundance was increased by heparin in a dose-and sulfation-dependent manner when used in combination with FGF-1. SP-C and AQP-5 mRNA levels were increased by heparin alone in a dose- and sulfation-dependent manner, while all FGFs lacked effect on SP-C or AQP-5 mRNA levels. These data indicate that heparin can be stimulatory to SP gene expression depending on concentration, degree of sulfation, and surrounding FGF environment, and that heparin plays a significant role in modulating alveolar epithelial cell phenotype in vitro.