Numerous investigators have described maintenance of airway epithelial cells from various species in a differentiated state in primary culture. Because the number of cells that can be isolated from the mouse trachea is very small, published techniques are unsuitable for this species. To examine the production of growth factors by murine airway epithelial cells, the authors developed a method for culture of mouse tracheal epithelial cells from explants, in which the population of cells was expanded in the presence of epidermal growth factor and insulin-like growth factor-I, which exhibited synergistic mitogenic activity. After subculture, an essentially pure population of epithelial cells was recovered, with a yield approximately tenfold greater than reported using protease dissociation of cells from the trachea. Culture of the cells at passage 2 on a collagen gel substratum induced differentiation toward a synthetic/secretory phenotype, accompanied by marked diminution in spontaneous and mitogen-induced DNA synthesis without loss of viability. In parallel, secretion of immunoreactive transforming growth factor-beta by the epithelial cells was strikingly increased, but could be partially down-regulated in the presence of mitogenic growth factors.