Free alveolar cells obtained from healthy unstimulated hamsters were tested for their ability to form colonies in soft agar. Every bronchial washing so far tested contained colon-forming cells. The average plating efficiency was 8.1% (2.4-18.3%). Alveolar colony-forming cells were characterized by having a long initial lag period (4-8 days) and only mononuclear phagocytes were found in the colony. Medium conditioned by baby hamster kidney cells or other cells was required for the initiation and maintenance of their growth. Alveolar cells from normal mice and rats also formed colonies under appropriate culture conditions.