Cultures of differentiating fetal human type II cells have been available for many years. However, studies with differentiated adult human type II cells are limited. We used a published method for type II cell isolation and developed primary culture systems for maintenance of differentiated adult human alveolar epithelial cells for in vitro studies. Human type II cells cultured on Matrigel (basolateral access) or a mixture of Matrigel and rat tail collagen (apical access) in the presence of keratinocyte growth factor, isobutylmethylxanthine, 8-bromo-cyclicAMP and dexamethasone (KIAD) expressed the differentiated type II cell phenotype as measured by the expression of SP-A, SP-B, SP-C, and fatty acid synthase and their morphologic appearance. These cells contain lamellar inclusion bodies and have apical microvilli. In both systems the cells appear well differentiated. In the apical access system, type II cell differentiation markers initially decreased and then recovered over 6 days in culture. Lipid synthesis was also increased by the addition of KIAD. In contrast, type II cells cultured on rat tail collagen (or tissue culture plastic) slowly lose their lamellar inclusions and expression of the surfactant proteins and increase the expression of type I cell markers. The expression of the phenotypes is regulated by the culture conditions and is, in part, reversible in vitro.