Keratinocyte growth factor (KGF) induces transient proliferation of alveolar type II cells (AEII) associated with surfactant alterations. To test the hypothesis that homeostasis of intracellular phospholipid stores is maintained under KGF-induced hyperplasia, we (1) collected tissue from adult rat lungs, fixed for light and electron microscopy 3 days after intratracheal instillation of 5 mg recombinant human (rHu) KGF/kg body weight or phosphate-buffered saline (PBS), and from untreated control animals (five animals/group) for design-based stereology of AEII and lamellar body (LB) ultrastructure; and (2) we analyzed uptake and distribution of instilled radiolabeled phospholipids. After rHuKGF, AEII-coverage of alveolar walls (PBS:8.3 +/- 3.0%; rHuKGF:30.6 +/- 4.8%) and number of AEII/ml lung volume (PBS:28.5 +/- 6.5 x 10(6); rHuKGF:48.2 +/- 5.8 x 10(6)) were increased (p < 0.008). Number (PBS:97 +/- 25; rHuKGF:54 +/- 7) and volume (PBS:45.3 +/- 13.8 microm(3); rHuKGF:21.0 +/- 4.7 microm(3)) of LBs per cell were decreased (p < 0.008), but not total amount/ml lung volume (PBS:128 +/- 46. 4 x 10(7) microm(3); rHuKGF:103 +/- 34. 7 x 10(7) microm(3)). This was paralleled by a shift to larger LBs. After rHuKGF, radiolabeled phospholipids accumulated in whole lung tissue relative to lavage fluid (p < 0.01). However, less radiolabel was incorporated per cell (p < 0.01). We conclude that under rHuKGF-induced AEII proliferation intracellular surfactant was decreased per single cell, whereas a constant amount was maintained per unit lung volume. We suggest that surfactant homeostasis is regulated at the level of phospholipid transport processes, for example, secretion and reuptake.