In a rat model of lung injury induced by the antineoplastic antibiotic, bleomycin, there is loss of type I alveolar epithelial cells (AECs) followed by infiltration of activated inflammatory cells, type II AEC proliferation, and fibrosis. At 4 and 7 days after bleomycin administration alveolar macrophages have increased production and release of active transforming growth factor (TGF)-beta1, an inhibitor of epithelial cell proliferation. Paradoxically at these same time intervals there is a concomitant induction of type II AEC proliferation. For TGF-beta-mediated signal transduction to occur, the expression of both TCF-beta receptor types I (TbetaR-I) and II (TbetaR-II) must be present. Using immunohistochemistry and in situ hybridization, 4 and 7 days after bleomycin administration the expression of TbetaR-I on AECs was reduced whereas that of TbetaR-II was unaltered. However, 14 and 28 days after bleomycin injury, when there is decreased proliferation and induction of differentiation of type II AECs, there was a return of TbetaR-I expression on AECs. In contrast, TbetaR-I and TbetaR-II were observed on interstitial fibroblasts at all time intervals after bleomycin administration. Because both TbetaR-I and TbetaR-II are required for signal transduction, the reduction of TbetaR-I levels on the alveolar epithelium may alter the sensitivity of AECs to the antiproliferative effects of TGF-beta1 present in increased quantities following bleomycin injury. The loss of an antiproliferative response to TGF-beta1 may be important for the regeneration of the alveolar epithelium by proliferation while the expression of both receptors onfibroblasts would result in TGF-1 signaling for the synthesis of connective tissue proteins. Ourfindings suggest that during bleomycin-induced pulmonary fibrosis, the effects of TGF-beta1 on cells may be regulated by the expression of TbetaRs.