Bone marrow-derived cells can take on the phenotype of epithelial cells and express epithelial-specific genes in multiple organs. Here, we focus on recent data on the appearance of marrow-derived epithelial cells in the adult lung. These findings have garnered significant skepticism because in most cases marrow-derived epithelial cells are very rare, the marrow cell of origin is not known, the techniques for detection have needed improvement, and there seem to be multiple mechanisms by which this occurs. Recent studies have focused on these concerns. Once these important concerns are addressed, further studies on the function(s) of these cells will need to be performed to determine whether this engraftment has any clinical significance-either beneficial or detrimental.