We hypothesized that substance P and capsaicin would cause the release of prostaglandin E2 (PGE2) from intrapulmonary bronchi isolated from Sprague-Dawley rats. Substance P (1 microM) caused the release of PGE2, measured with enzyme immunoassay, from the isolated airway segments; PGE2 release was inhibited by the neurokinin (NK)1-receptor antagonist, RP-67580, by inhibition of cyclooxygenase with meclofenamate, and by removal of the epithelium. The release of PGE2 caused by capsaicin (1 microM) was similar in magnitude to that caused by substance P. The capsaicin-induced release of PGE2 was inhibited by desensitization of sensory nerves with capsaicin and by RP-67580, meclofenamate, and epithelial denudation. We conclude that activation of NK1 receptors on epithelium causes release of PGE2, which most likely represents the ultimate mediator of airway smooth muscle relaxation, produced by exogenous neuropeptides and by activation of the sensory nerve inhibitory system. Epithelial damage, such as that seen in asthmatic airways, would disrupt this protective system in the lungs, which could contribute to the development of airway disease.