The Na,K-ATPase plays an essential role in active alveolar epithelial fluid resorption. In fetal and adult alveolar epithelial cells, glucocorticoids (GC) increase Na, K-ATPase activity and mRNA levels. We sought to define the mechanism of Na,K-ATPase gene upregulation by glucocorticoids. In a rat alveolar epithelial cell line (RLE), dexamethasone (Dex) increased ₁ subunit Na,K-ATPase mRNA expression 2-3 fold within 3 hr after exposure to the glucocorticoid. The increased gene expression was due to increased transcription as demonstrated by nuclear run on assays, while mRNA stability remained unchanged. Transient transfection of 5' deletion mutants of a ₁ promoter-reporter construct demonstrated a 1.5 - 2.2 fold increase in promoter activity by Dex. All of the 5' deletion constructs contained partial or palindromic GC regulatory elements (GRE) and responded to GC. The increased expression of promoter reporter was inhibited by RU486, a GC receptor antagonist, suggesting the involvement of glucocorticoid receptor (GR). The palindromic GRE at -631 demonstrated Dex induction in a heterologous promoter construct. Gel mobility shift assays using RLE nuclear extracts demonstrated specific binding to this site and presence of GR. We conclude that glucocorticoids directly stimulate transcription of Na,K-ATPase ₁. gene expression in adult rat lung epithelial cells through a GR dependent mechanism that can act at multiple sites.