Although keratinocyte growth factor (KGF) protects against experimental acute lung injury, the mechanisms for the protective effect are incompletely understood. Therefore, the time-dependent effects of KGF on alveolar epithelial fluid transport were studied in rats 48–240 h after intratracheal administration of KGF (5 mg/kg). There was a marked proliferative response to KGF, measured both by in vivo bromodeoxyuridine staining and by staining with an antibody to a type II cell antigen. In controls, alveolar liquid clearance (ALC) was 23 ± 3%/h. After KGF pretreatment, ALC was significantly increased to 30 ± 2%/h at 48 h, to 39 ± 2%/h at 72 h, and to 36 ± 3%/h at 120 h compared with controls (P < 0.05). By 240 h, ALC had returned to near-control levels (26 ± 2%/h). The increase in ALC was explained primarily by the proliferation of alveolar type II cells, since there was a good correlation between the number of alveolar type II cells and the increase in ALC (r = 0.92,P = 0.02). The fraction of ALC inhibited by amiloride was similar in control rats (33%) as in 72-h KGF-pretreated rats (38%), indicating that there was probably no major change in the apical pathways for Na uptake in the KGF-pretreated rats at this time point. However, more rapid ALC at 120 h, compared with 48 h after KGF treatment, may be explained by greater maturation of α-epithelial Na channel, since its expression was greater at 120 than at 48 h, whereas the number of type II cells was the same at these two time points. β-Adrenergic stimulation with terbutaline 72 h after KGF pretreatment further increased ALC to 50 ± 7%/h (P < 0.5). In summary, KGF induced a sustained increase over 120 h in the fluid transport capacity of the alveolar epithelium. This impressive upregulation in fluid transport was further enhanced with β-adrenergic agonist therapy, thus providing evidence that two different treatments can simultaneously increase the fluid transport capacity of the alveolar epithelium.