SP-C-deficient (SP-C -/-) mice developed a severe pulmonary disorder associated with emphysema, monocytic infiltrates, epithelial cell dysplasia, and atypical accumulations of intracellular lipids in type II epithelial cells and alveolar macrophages. Whereas alveolar and tissue surfactant phospholipid pools were increased, levels of other surfactant proteins were not altered (SP-B) or were modestly increased (SP-A and SP-D). Analysis of pressure-volume curves and forced oscillatory dynamics demonstrated abnormal respiratory mechanics typical of emphysema. Lung disease was progressive, causing weight loss and cardiomegaly. Extensive alveolar remodeling was accompanied by type II cell hyperplasia, obliteration of pulmonary capillaries, and widespread expression of alpha-smooth muscle actin, indicating myofibroblast transformation in the lung parenchyma. Dysplastic epithelial cells lining conducting airways stained intensely for the mucin, MUC5A/C. Tissue concentrations of proinflammatory cytokines were not substantially altered in the SP-C (-/-) mice. Production of matrix metalloproteinases (MMP-2 and MMP-9) was increased in alveolar macrophages from SP-C (-/-) mice. Absence of SP-C caused a severe progressive pulmonary disorder with histologic features consistent with interstitial pneumonitis.