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Evidence of endoplasmic reticulum (ER) stress has been found in lungs of patients with familial and sporadic idiopathic pulmonary fibrosis. We tested whether ER stress causes or exacerbates lung fibrosis by (i) conditional expression of a mutant form of surfactant protein C (L188Q SFTPC) found in familial interstitial pneumonia and (ii) intratracheal treatment with the protein misfolding agent tunicamycin. We developed transgenic mice expressing L188Q SFTPC exclusively in type II alveolar epithelium by using the Tet-On system. Expression of L188Q SFTPC induced ER stress, as determined by increased expression of heavy-chain Ig binding protein (BiP) and splicing of X-box binding protein 1 (XBP1) mRNA, but no lung fibrosis was identified in the absence of a second profibrotic stimulus. After intratracheal bleomycin, L188Q SFTPC-expressing mice developed exaggerated lung fibrosis and reduced static lung compliance compared with controls. Bleomycin-treated L188Q SFTPC mice also demonstrated increased apoptosis of alveolar epithelial cells and greater numbers of fibroblasts in the lungs. With a complementary model, intratracheal tunicamycin treatment failed to induce lung remodeling yet resulted in augmentation of bleomycin-induced fibrosis. These data support the concept that ER stress produces a dysfunctional epithelial cell phenotype that facilitates fibrotic remodeling. ER stress pathways may serve as important therapeutic targets in idiopathic pulmonary fibrosis.