Historically, bronchioalveolar lavage (BAL) samples have been prepared by a direct smear (DS) technique. Recent advances in liquid-based cytology have led to a revolution in cytological specimen preparation. Cyto-SED system (CS) is a manual liquid-based cytology system, designed for small-scale use. A total of 137 samples from patients with radiographically detectable lesions underwent BAL procedures at Papworth Hospital NHS Trust over a 4-month period. After preparation for diagnostic purposes with the DS method, the remaining sample was prepared using the CS system. The slides produced were allocated a blind study number and screened by three independent screeners. The cellular morphology was well preserved and comparable between both techniques. Of the 137 patients, 38% were confirmed as malignant by cytology or histology; 71% of these malignant diagnosis were confirmed by the DS technique and 91% confirmed by the CS. The results demonstrate that the CS is a viable alternative to the DS technique. The cytological detail is clearly defined without a loss of three-dimensional information, thus aiding the differential diagnosis of malignancy. Cyto-SED cytology system yields a higher diagnostic accuracy than the conventional direct smear technique without compromising on cytological detail.