Efficient clearance of mucus and inhaled pathogens from the lung is dependent on an optimal airway surface liquid (ASL) volume, which is maintained by the regulated transport of sodium and chloride across the airway epithelium. Accumulating evidence suggests that impaired mucus clearance in cystic fibrosis (CF) airways is a result of ASL depletion caused by excessive Na(+) absorption through the epithelial sodium channel (ENaC). However, the cellular mechanisms that result in increased ENaC activity in CF airways are not completely understood. Recently, proteases were shown to modulate the activity of ENaC, but the relevance of this mechanism to the physiologic regulation of ASL volume is unknown. Using primary human airway epithelial cells, we demonstrate that: (i) protease inhibitors are present in the ASL and prevent the activation of near-silent ENaC, (ii) when the ASL volume is increased, endogenous protease inhibitors become diluted, allowing for proteolytic activation of near-silent channels, and (iii) in CF, the normally present near-silent pool of ENaC is constitutively active and the alpha subunit undergoes increased proteolytic processing. These findings indicate that the ASL volume modulates the activity of ENaC by modification of the serine protease-protease inhibitor balance and that alterations in this balance contribute to excessive Na(+) absorption in cystic fibrosis.