In 1977, Mason and Williams developed the concept of the alveolar epithelial type II (AE2) cell as a defender of the alveolus. It is well known that AE2 cells synthesise, secrete, and recycle all components of the surfactant that regulates alveolar surface tension in mammalian lungs. AE2 cells influence extracellular surfactant transformation by regulating, for example, pH and [Ca2+] of the hypophase. AE2 cells play various roles in alveolar fluid balance, coagulation/fibrinolysis, and host defence. AE2 cells proliferate, differentiate into AE1 cells, and remove apoptotic AE2 cells by phagocytosis, thus contributing to epithelial repair. AE2 cells may act as immunoregulatory cells. AE2 cells interact with resident and mobile cells, either directly by membrane contact or indirectly via cytokines/growth factors and their receptors, thus representing an integrative unit within the alveolus. Although most data support the concept, the controversy about the character of hyperplastic AE2 cells, reported to synthesise profibrotic factors, proscribes drawing a definite conclusion today.