Four adult patients presented with unilateral multicystic lung disease. The cysts had been detected years previously on chest radiographs in three patients. Two patients had histories of repeated childhood pneumonias. Preoperative diagnosis of bullous emphysema with rupture was made in three patients who presented with pneumothorax. Lobectomy was done in two patients and pneumonectomy in two patients. Macroscopically, each lung was spongy with cysts that contained gelatinous vesicular or grape-like structures resembling normal or molar placental tissue. Bullous emphysema was evident in one lung and marked panacinar emphysema in another. In one patient who had a lobectomy, the ipsilateral lobe of compressed lung re-expanded after surgery and proved to be cystic as well on subsequent radiographs. The vesicular and grape-like structures histopathologically are papillary structures with central edematous cores and a covering of cuboidal epithelial cells. Degenerate villi became either hydatidiform, fibrotic, or calcified. At low magnification the histology was similar to that of placenta with hydatidiform change. Emphysematous lung in which villiform structures appeared at the edges of bullae was found histologically in two patients. Lymphangiectasia was present in all patients. The placentoid bullous lesion has distinct macroscopic and microscopic features and is clinically unusual in that the cysts are unilateral and appear in otherwise healthy young adults. We do not know whether the lesion is a malformation or a peculiar devolution of localized bullous emphysema. We favor the latter interpretation. Torsion of lung may cause the lymphangiectasia and contribute to the unusual histology. Excision is curative.