The isolated, perfused trachea preparation has been used to compare reactivity of the intact airway in response to differential exposure of the mucosal (intraluminal) and serosal (extraluminal) surfaces to contractile and relaxant agonists and other agents, and to gain insight into the modulatory role of the epithelium and the pathways involved. The apparatus has also been configured for simultaneous measurement of transepithelial potential difference and changes in tracheal diameter, thereby providing parallel observations of epithelial and smooth muscle function and reactivity to drugs. The transepithelial potential difference is a product of transepithelial resistance and short circuit current, and the present study describes a novel isolated, perfused tracheal apparatus which allows simultaneous measurement of transepithelial potential difference, transepithelial resistance and mechanical responses of the smooth muscle. The apparatus was validated using well-known ion transport inhibitors [intraluminal amiloride and 5-nitro-2-(3-phenylpropyl-amino) benzoic acid (NPPB), extraluminal ouabain and bumetanide], bronchoactive agonists (extraluminal methacholine, histamine and terbutaline), and osmolytes (intraluminal d-mannitol and NaCl) to induce epithelium-derived relaxing factor-mediated relaxations. This apparatus will facilitate investigation of interactions between the epithelium and smooth muscle in airways that retain their in situ structure, and signaling mechanisms potentially involved in the regulation of airway smooth muscle tone.