Stimulation of alveolar macrophages leads to impaired function of the alveolar barrier with subsequent edema formation, which causes hypoxia of the alveolar cells. Here we tested, whether release of pro-inflammatory mediators upon macrophage stimulation with LPS is aggravated by hypoxia, and whether other cells of the alveolar wall also release these mediators, and whether stimulation has consequences for barrier tightness. The alveolar wall was modelled by co-culturing rat alveolar macrophages, primary rat alveolar type II cells (ATII), and rat lung microvascular endothelial cells on transwell filters. Cells were stimulated with LPS (1mg/ml) in normoxia and hypoxia (1.5% O2). mRNA expression was measured by qRT-PCR using 28S rRNA for normalization. LPS (4h) increased TNF-a and IL-6 mRNA in the co-culture, which resulted largely from macrophages. However, LPS also caused cytokine-expression in ATII and endothelial cells. In all cell types, LPS-induced TNF-a and IL-6 mRNA had almost returned to baseline values 24h and 48h after stimulation. Hypoxia caused a slow increase in TNF-a and IL-6 mRNA in macrophages, ATII cells, and endothelial cells. Effects of LPS and hypoxia were not additive. Expression of MCP-1, MMP-12, and COX-1 was not affected. In presence of macrophages, both 24h and 48h exposure to LPS and hypoxia decreased the electrical resistance of the co-cultures, whereas ATII cell mono-cultures were not affected. These results indicate a pronounced release of pro-inflammatory mediators upon LPS-stimulation in normoxia and hypoxia mainly from alveolar macrophages, which seems involved in increasing alveolar permeability.