Hypersensitivity pneumonitis (extrinsic allergic alveolitis) caused by inhaled allergens can progress to disabling or even fatal end-stage lung disease. The only truly effective treatment is early recognition and control of exposure. Although patients produce antibody exuberantly, the immunopathogenesis involves cellular immunity--notably, CD8(+) cytotoxic lymphocytes, multinucleate giant cell granulomas, and ultimately interstitial fibrosis. Many causative agents have been recognized in occupational dusts or mists, but most current new cases arise from residential exposure to pet birds (pigeons and parakeets), contaminated humidifiers, and indoor molds. The symptoms and physical findings are nonspecific. Serum IgG containing high titers of specific antibody to the offending antigen is elevated. Pulmonary function tests show restrictive and diffusion defects with hypoxemia, especially after exercise. Occasionally, small airways disease causes obstruction. Radio-graphic changes vary according to the stage of the disease and are best evaluated by means of high-resolution computed tomography. In typical cases, the history of a known exposure and the presence of a characteristic interstitial lung disease with serologic confirmation of IgG antibody to the offending antigen suffice for diagnosis. In more obscure cases, observation of changes after a natural environmental exposure, bronchoalveolar lavage, and lung biopsy might be indicated. Among the many questions that remain are the following: What is the prevalence of hypersensitivity pneumonitis and how often is it the cause of chronic interstitial fibrosis? What is the long-term prognosis? Why do most individuals exposed to these antigens develop a vigorous antibody response whereas only a few develop the disease? How does exposure to endotoxin and cigarette smoking affect the disease? To answer these questions, standardized and validated clinical laboratory immunochemical tests are needed, in addition to a systematic approach to diagnosis, classification of disease severity, risk assessment, and management. This review is limited to the disease caused by airborne allergens and focuses on its immunopathogenesis, eliciting agents, clinical manifestations, diagnosis, management, and prognosis.