Normal rabbit alveolar macrophages are engorged with large, dense inclusions which contain whorls of myelin figures, suggesting an exogenous source of polar lipids in their diet. One contributory source of such lipids is surfactant, since macrophages were seen ingesting tubular myelin and vacuoles containing remnants of it were found in the cytoplasm. Thus, as indicated previously in kinetic studies, it appears that alveolar macrophages participate in the turnover of surfactant. However, the relative importance of the macrophage in comparison to other pathways of surfactant removal remains to be determined. It is also noteworthy that although tubular myelin and myelin figures were abundant in the fixative used to wash out the lungs, bacteria were not found in it or in the macrophages. Thus, removal of obsolete surfactant may prove to be one of the mojor endocytic functions of alveolar macrophages.