Pulmonary surfactant is a complex mixture of proteins and phospholipids which possesses unique physical properties. It is no longer viewed just as a system for lowering surface tension but may play a protective role particularly with reference to inhalation of noxious substances. Derangement of the surfactant system may proceed to the development of disease by opening the way to toxic injury of the delicate epithelial lining of the lungs. Currently, it is believed that surfactant, which is synthetised, stored and secreted by type II alveolar pneumocytes, spreads rapidly on release to form a monomolecular layer covering the squamous surface lining of the alveoli. Furthermore, physiological and histological studies show that this monolayer extends into the bronchioli and possibly bronchi also. Effectively, the inspired air encounters an extensive and continuous 'oily' surface. It has been known for some time that cigarette smokers appear to sequester pulmonary surfactant into alveolar macrophages, leaving less free surfactant on the alveolar and bronchiolar surfaces. This process may be initiated by physical inactivation of surfactant by tobacco smoke. The tar of tobacco smoke alters the surface properties of surfactant as well as the compliance of the lung in vitro. This process may not only lead to the associated increase in the number of alveolar macrophages found in smokers, but could, by lessening the effective protective role of surfactant, lead to direct toxic injury of the lung and the development of chronic obstructive lung disease.