Human and rat lungs were degassed and filled with air and physiological salt solution for determination of pressure-volume relationships. Extracts were prepared from the specimens and examined for their surface film-forming activity. Both the aeration of the alveolar structure of the lungs at functional residual pressure and the surface activity of the extracts showed wide variation. Numerical ratios were defined to express these two properties quantitatively, and a high degree of correlation was observed between them. The range of correlation was extended by treating the rat lungs with nonionic detergents. These findings support the hypothesis that the stability of the pulmonary alveolar structure is dependent on intrinsic surface-active material and have encouraged further attempts at formulating a theory of alveolar mechanics, taking surface forces into account. The theory is presented, and some of its weaknesses are pointed out. Submitted on October 21, 1960