Fatty acid synthase (FAS; EC 2.3.1.85) supplies de novo fatty acids for pulmonary surfactant synthesis, and FAS gene expression is both developmentally and hormonally regulated in the fetal lung. To further examine hormonal regulation of FAS mRNA and to determine the cellular localization of FAS gene expression, we cultured human fetal lungs (18-22 wk gestation) as explants for 1-4 days in the absence (control) or presence of glucocorticoid [dexamethasone (Dex), 10 nM] and/or cAMP agents (8-bromo-cAMP, 0.1 mM and IBMX, 0.1 mM). FAS protein content and activity increased similarly in the presence of Dex (109 and 83%, respectively) or cAMP (87 and 111%, respectively), and responses were additive in the presence of both hormones (230 and 203%, respectively). With a rabbit anti-rat FAS antibody, FAS immunoreactivity was not detected in preculture lung specimens but appeared in epithelial cells lining the tubules with time in culture. Dex and/or cAMP markedly increased staining of epithelial cells, identified as type II cells, whereas staining of mesenchymal fibroblasts was very low under all conditions. With in situ hybridization, FAS mRNA was found to be enriched in epithelial cells lining the alveolar spaces, and the reaction product increased in these cells when the explants were cultured with the hormones. The increased FAS mRNA content in the presence of Dex and/or cAMP is primarily due to increased stabilization of mRNA, although Dex alone increased the transcription rate by approximately 30%. We conclude that hormonal treatment of cultured human fetal lungs increases FAS gene expression primarily by increasing stability of the message. The induction of FAS during explant culture and by hormones occurs selectively in type II epithelial cells, consistent with the regulatory role of this enzyme in de novo synthesis of fatty acid substrate for surfactant synthesis in perinatal lungs.