The mechanisms explaining the beneficial effects of glucocorticoid in ventilator-dependent preterm infants are not known. In the present randomized trial, we evaluated the hypothesis that dexamethasone (DEX) treatment of small, preterm infants at risk for chronic lung disease favorably affects the surfactant system. Twenty-three ventilator-dependent infants, with a mean +/- SD gestational age of 26 +/- 2 wk and a mean birth weight of 836 +/- 173 g, received 1 wk of treatment with either DEX (dose 0.5 mg/kg/d) or placebo beginning at 2 wk of age. The airway specimens were analyzed for surfactant components, surface activity, surfactant inhibitors, and inflammatory mediators. The concentrations of these parameters in epithelial lining fluid were calculated using the urea method. DEX treatment decreased the concentration of nonsedimentable protein in epithelial lining fluid within 3 d (p < 0.05). The nonsedimentable fraction of airway specimens decreased the surface activity of surfactant as a function of protein concentration. At a constant protein concentration, the protein from placebo-treated infants inhibited the surface activity of human surfactant in vitro more than protein from DEX-treated infants (p < 0.05). DEX transiently increased the concentration of surfactant protein-A in epithelial lining fluid but had no effect on surface activity of the sedimentable surfactant complex or on concentrations of phosphatidylcholine, IL-1 beta, lactoferrin, or myeloperoxidase. We conclude that the acute beneficial effect of DEX treatment in preterm ventilator-dependent infants may in part be mediated through a decrease in the concentration of non-sedimentable protein and a decrease in the capacity of this protein to inhibit surface activity.