Abstract. Myofibroblast-like cells containing smooth muscle actin have been identified in lung injury and repair. These cells differ from typical smooth muscle cells by architectural configuration, location and lack of smooth muscle myosin. Their progenitors are unknown. We hypothesized that these cells might have a developmental analog critical to lung morphogenesis. Lung tissue from developing and adult human lungs was studied using a highly specific monoclonal antibody directed against alpha smooth muscle actin (ASMA). Cells im-munoreactive for ASMA (ASMA cells) were identified prenatally in the form of smooth muscle investing the developing vasculature and airway structures. ASMA was not expressed in undifferentiated mesenchymal cells at any prenatal stage. Late in development, ASMA cells within the lung acinus increased proportionally to terminal airway and vascular complexity. In the early postnatal period, the specific distribution of ASMA cells within inflated lung became clearer, and three populations were identified: (1) typical smooth muscle investing the large airways and blood vessels; (2) small clusters of cells with in the acinus distributed at the tips of septa protruding into the alveolar duct; (3) individual cells within the alveolar sac sparsely distributed near the junctions of individual alveoli, frequently in association with small blood vessels. We conclude that ASMA cells appear only in developing small and large airways and pulmonary vessels and that they may play a critical role in branching morphogenesis during development.