The lung and other organs are comprised of both cellular and extracellular compartments. Interaction of these components modulates physiological function at the organ, cellular, and subcellular levels. Extracellular components in the gas-exchange region of the lung include both noncellular interstitium and basement membranes. Connective tissue elements of the interstitium in part determine ventilatory function by contributions to tissue compliance and to resistance of the diffusion barrier. The basement membrane underlies cells of both the alveolar epithelium and the capillary endothelium; basement membrane components exert biological effects on adjacent cells through receptor-mediated interactions. This review emphasizes current knowledge concerning the composition and biological activity of extracellular matrix in the alveolar region of the lung. Matrix synthesis and turnover are also considered. Directions for future research are suggested in the context of current knowledge of the lung and other model systems.