In response to injury, AEC-II stem cells undergo self-renewal and differentiate to AEC-I cells to replenish the damaged alveolar epithelial pool. However, differentiation of AEC-II to AEC-I cells is profoundly altered in IPF airway, as a result of the vast abnormalities in ECM, epithelial basement membrane damages and destruction of the airway architecture. The ECM is not only a supportive structure but also functions to regulate cell proliferation and differentiation. It has been shown that changes in ECM component influence the morphology, the phenotype of alveolar epithelial cells and the differentiation of AEC-II to AEC-I-like cells (Olsen et al., 2005). In addition, mechanical changes have been shown to regulate AEC phenotype. For instance, mechanical distension in favor of the AEC-I cell phenotype and inhibit the AEC-II phenotype, while contraction promotes AEC-II phenotype (Dobbs and Gutierrez, 2001).
Furthermore, many growth factors and cytokines produced in response to injury can influence AEC-II differentiation. For instance, keratinocyte growth factor (KGF) which is an epithelial mitogen can induce apoptosis and differentiation of hyperplasic AEC-II cells to restore the normal alveolar epithelium in vivo (Fehrenbach et al., 1999). In addition, insulin growth factor (IGF) signaling has been found to regulate the differentiation of AEC-II cells to AEC-I-like cells. The inhibition of IGF receptors in AEC-II cells derived from hyperoxia-exposed lung is able to maintain the AEC-II phenotype without the transdifferentiation to AEC-I-like cells (Narasaraju et al., 2006). The activity of leukotriene A4 (LTA4) hydrolase has also been linked to AEC-II to AEC-I differentiation. In normal AEC-IIs and the ones locate in the fibrotic regions of IPF airways, LTA4 hydrolase is predominantly expressed in the nucleus. While in AEC-I and AEC-II-derived AEC-I-like cells, LTA4 hydrolase accumulates in the cytoplasm, suggesting nuclear export of LTA4 hydrolase influences AEC-II differentiation (Brock et al., 2005).