Types A and B Niemann-Pick disease (NPD) are lipid storage diseases caused by the deficient activity of the lysosomal enzyme, acid sphingomyelinase (ASM). Type B NPD is associated with progressive pulmonary function decline and frequent respiratory infections. ASM knock-out (ASMKO) mice are available as a model for NPD, but the lung pathology in these mice has not been adequately characterized. This study shows that by 10 weeks of age ASMKO mice have a significantly higher number of cells in their pulmonary airspaces than normal mice, consisting primarily of enlarged and often multinucleated macrophages. These mice also have much higher levels of sphingomyelin in their airspaces at 10 weeks of age, and both cell numbers and sphingomyelin concentrations remain elevated until 26 weeks of age. In these older mice an increased number of neutrophils is also seen. The alveolar cell population in the ASMKO mice produces less superoxide when stimulated, but this can be corrected by providing recombinant ASM to the culture media. Elevated levels of the chemokines macrophage inflammatory protein-2 and macrophage inflammatory protein-1alpha were also present in the bronchoalveolar lavage fluid of ASMKO mice, and this correlated with increased production of these chemokines by cultured macrophages and enhanced immunostaining in situ. Also, lung histology showed increased cellularity in the alveolar walls of ASMKO mice, but no evidence of fibrosis. Ultrastructural analysis of the lungs showed that the ASMKO mice have similar pathologic features to human NPD patients, with variable lipid storage evident in type I pneumocytes, endothelial cells, and airway ciliated epithelia. The alveolar macrophage, however, was the most dramatically affected cell type in both mice and humans. These studies indicate that the ASMKO mice can be used as a model to study the lung pathology associated with NPD, and demonstrate that the cellular and biochemical analysis of pulmonary airspaces may be a useful approach to monitoring disease progression and/or treatment.