Endothelial progenitor cells (EPCs) have been isolated postnatally from bone marrow, blood, and both the intima and adventitia of conduit vessels. However, it is unknown whether EPCs can be isolated from the lung microcirculation. Thus we sought to determine whether the microvasculature possesses EPCs capable of de novo vasculogenesis. Rat pulmonary artery (PAEC) and microvascular (PMVEC) endothelial cells were isolated and selected by using a single-cell clonogenic assay. Whereas the majority of PAECs (approximately 60%) were fully differentiated, the majority of PMVECs (approximately 75%) divided, with approximately 50% of the single cells giving rise to large colonies (>2,000 cells/colony). These highly proliferative cells exhibited the capacity to reconstitute the entire proliferative hierarchy of PMVECs, unveiling the existence of resident microvascular endothelial progenitor cells (RMEPCs). RMEPCs expressed endothelial cell markers (CD31, CD144, endothelial nitric oxide synthase, and von Willenbrand factor) and progenitor cell antigens (CD34 and CD309) but did not express the leukocyte marker CD45. Consistent with their origin, RMEPCs interacted with Griffonia simplicifolia and displayed restrictive barrier properties. In vitro and in vivo Matrigel assays revealed that RMEPCs possess vasculogenic capacity, forming ultrastructurally normal de novo vessels. Thus the pulmonary microcirculation is enriched with EPCs that display vasculogenic competence while maintaining functional endothelial microvascular specificity.