Explants of mouse lung were cultured at various stages of injury after exposure to hyperoxia for determination of whether endothelial or epithelial injury alone could stimulate fibrosis in a blood-free environment. Mice were exposed to 95% O2 for periods up to 6 days. Then one lobe of lung was prepared for organ culture, and others were used for assessment of lung damage by morphologic studies and by the protein and cellular content of bronchoalveolar lavage (BAL) fluid. Explants cultured when the lung showed endothelial injury only were not different from air-exposed controls. As alveolar damage, particularly to Type 1 epithelial cells, increased at 6 days, more protein was found by lavage; and after culture, overall DNA synthesis in explants was reduced. Autoradiography showed that epithelial cell proliferation was preferentially retarded while fibroblast growth became predominant. Collagen production was also significantly increased after 3 and 6 days of culture. In these explants there were few macrophages and no white blood cells or other blood components. Some mice, returned to air after hyperoxia, showed prompt epithelial repair, and cultures of these lungs were not different from controls. The results suggest that severe injury and retarded repair of the alveolar epithelium disturbs normal epithelial-fibroblast interactions and is sufficient to promote the fibrotic process. Less severe injury involving the endothelium only is not associated with fibrosis.