Transgenic mice, in which the level of surfactant protein (SP)-B mature peptide varied 5.6-fold between SP-B(+/-) and SP-B-overexpressing lines (SP-B+/+/+), were used to test the hypothesis that SP-B protects against endotoxin-induced lung inflammation. Intratracheal administration of endotoxin resulted in significantly lower concentration of SP-B mature peptide and elevated levels of total protein in bronchoalveolar lavage fluid of SP-B(+/-) mice compared with SP-B-overexpressing mice, indicating that endotoxin treatment leads to impairment of SP-B expression coincident with increased lung injury in SP-B(+/-) mice. Recruitment of inflammatory cells and elaboration of proinflammatory cytokines in bronchoalveolar lavage fluid were reduced in SP-B-overexpressing mice compared with SP-B(+/-) mice, suggesting that SP-B inhibited endotoxin-induced lung inflammation. Lung compliance and tissue damping were significantly decreased in SP-B(+/+) and SP-B(+/-) mice, but were not changed in SP-B(+/+/+) mice, consistent with a protective effect of SP-B. The minimum surface tension of large aggregate surfactant was significantly lower for surfactant isolated from SP-B-overexpressing mice, both in the absence and the presence of added plasma proteins. These data suggest that SP-B protected against endotoxin-induced lung inflammation by enhancing surfactant function, resulting in reduced lung injury, decreased influx of inflammatory cells, and lower cytokine levels; in contrast, levels of SP-B in SP-B(+/-) mice were further decreased by endotoxin treatment, likely exacerbating lung injury in this group.