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Previous studies have shown that the innate immune stimulant LPS augments mechanical ventilation-induced pulmonary coagulation and inflammation. Whether these effects are mediated by alveolar epithelial cells is unclear. The alveolar epithelium is a key regulator of the innate immune reaction to pathogens and can modulate both intra-alveolar inflammation and coagulation through up-regulation of proinflammatory cytokines and tissue factor (TF), the principal initiator of the extrinsic coagulation pathway. We hypothesized that cyclic mechanical stretch (MS) potentiates LPS-mediated alveolar epithelial cell (MLE-12) expression of the chemokine keratinocyte-derived cytokine (KC) and TF. Contrary to our hypothesis, MS significantly decreased LPS-induced KC and TF mRNA and protein expression. Investigation into potential mechanisms showed that stretch significantly reduced LPS-induced surface expression of TLR4 that was not a result of increased degradation. Decreased cell surface TLR4 expression was concomitant with reduced LPS-mediated NF-κB activation. Immunofluorescence staining showed that cyclic MS markedly altered LPS-induced organization of actin filaments. In contrast to expression, MS significantly increased LPS-induced cell surface TF activity independent of calcium signaling. These findings suggest that cyclic MS of lung epithelial cells down-regulates LPS-mediated inflammatory and procoagulant expression by modulating actin organization and reducing cell surface TLR4 expression and signaling. However, because LPS-induced surface TF activity was enhanced by stretch, these data demonstrate differential pathways regulating TF expression and activity. Ultimately, loss of LPS responsiveness in the epithelium induced by MS could result in increased susceptibility of the lung to bacterial infections in the setting of mechanical ventilation.