Although the effects of surfactant protein B (SP-B) on lipid surface activity in vitro and in vivo are well known, the relationship between molecular structure and function is still not fully understood. To further characterize protein structure-activity correlations, we have used physical techniques to study conformation, orientation, and molecular topography of N-terminal SP-B peptides in lipids and structure-promoting environments. Fourier transform infrared (FTIR) and CD measurements of SP-B1_25 (residues 1-25) in methanol, SDS micelles, egg yolk lecithin (EYL) liposomes, and surfactant lipids indicate the peptide has a dominant helical content, with minor turn and disordered components. Polarized FTIR studies of SP-B,-25 indicate the long molecular axis lies at an oblique angle to the surface of lipid films. Truncated peptides were similarly examined to assign more accurately the discrete conformations within the SP-B,_,, sequence. Residues Cys-8-Gly-25 are largely a-helix in methanol, whereas the N-terminal segment Phe-1-Cys-8 had turn and helical propensities. Addition of SP-Bl-25 spin-labeled at the N-terminal Phe (i.e., SP-BT_25) to SDS, EYL, or surfactant lipids yielded electron spin resonance spectra that reflect peptide bound to lipids, but retaining considerable mobility. The absence of characteristic radical broadening indicates that SP-B1-25 is minimally aggregated when it interacts with these lipids. Further, the high polarity of SP-BI-25 argues that the reporter on Phe-1 resides in the headgroup of the lipid dispersions. The blue-shift in the endogenous fluorescence of Trp-9 near the N-terminus of SP-B1-25 suggests that this residue also lies near the lipid headgroup. A summary model based on the above physical experiments is presented for SP-BI-2S interacting with lipids.