Recent studies in transgenic mice have revealed important insights into the roles of GM-CSF in regulation of surfactant homeostasis and lung host defense. Interruption of the GM-CSF signaling pathway by targeted ablation of the GM-CSF gene or its receptor (GM(-/-) or GM Rbetac(-/-) mice, respectively) resulted in pulmonary alveolar proteinosis (PAP) but no hematologic abnormalities. Alveolar macrophages from GM(-/-) mice have reduced capacity for surfactant catabolism, cell adhesion, phagocytosis, bacterial killing, Toll-receptor signaling, and expression of various pathogen-associated molecular pattern recognition receptors, suggesting arrest at an early stage of differentiation. PAP and abnormalities of alveolar macrophage function were corrected by local expression of GM-CSF in the lung, and expression of the transcription factor PU.1 in alveolar macrophages of GM(-/-) mice rescued most defects. Recently, a strong association of auto-antibodies to GM-CSF or GM-CSF receptor gene mutations with PAP has implicated GM-CSF signaling abnormalities in the pathogenesis of PAP in humans. Together, these observations demonstrate that GM-CSF has a critical role in regulation of surfactant homeostasis and alveolar macrophage innate immune functions in the lung.