Exocytosis is fundamental in biology and requires an orchestra of proteins and other constituents to fuse a vesicle with the plasma membrane. Although the molecular fusion machinery appears to be well conserved in evolution, the process itself varies considerably with regard to the diversity of physico-chemical and structural factors that govern the delay between stimulus and fusion, the expansion of the fusion pore, the release of vesicle content, and, finally, its extracellular dispersion. Exocytosis of surfactant is unique in many of these aspects. This review deals with the secretory pathway of pulmonary surfactant from the type II cell to the air-liquid interface, with focus on the distinct mechanisms and regulation of lamellar body (LB) fusion and release. We also discuss the fate of secreted material until it is rearranged into units that finally function to reduce the surface tension in the lung.