We have developed a method for isolation and purification of specific types of lung cells from rats. Alveolar type II cells were purified from 18% in the initial cell digest to 30% after centrifugal elutriation and finally to over 80% following density gradient centrifugation. Clara cells were enriched from 0.8% in the cell digest to 40 to 60% by use of centrifugal elutriation. In control animals, aryl hydrocarbon hydroxylase activity was found to increase in parallel with Clara cell purity but was almost undetectable in the type II cells. Following pretreatment of rats with beta-naphthoflavone, aryl hydrocarbon hydroxylase activity increased both in Clara cells and particularly, in alveolar type II cells. This methodology provides a means for investigation of the effects of toxic and carcinogenic compounds on different populations of lung cells.