AIMS: To investigate nine patients with histological changes at open lung biopsy compatible with so-called "small airways disease"; to define these changes and distinguish them from other types of bronchiolitis; and to correlate them with clinical features, respiratory physiology, and other laboratory investigations. METHODS: The open biopsy sections and the clinical records were reviewed. RESULTS: There was chronic inflammation of the walls of centri-acinar respiratory bronchioles and peribronchiolar alveoli. Peripheral alveoli of affected acini were spared. Although lumens were narrowed and distorted, obstruction by granulation tissue plugs was not a feature. Clinical backgrounds included Hodgkin's disease, yellow nail syndrome, sicca syndrome, asthma and psoriasis. The main presenting symptoms were cough, dyspnoea and wheeze, often associated with basal crackles and basal shadowing. There was no consistent immunological or haematological abnormality. Sputum culture was negative in six patients, and a variety of organisms were cultured from three others. In most cases respiratory function tests revealed an irreversible obstructive defect (combined in some cases with a restrictive defect), gas trapping, and well preserved gas transfer. Lung volumes were normal. Bronchodilators, with steroids and azathioprine in more seriously affected patients, stabilised the disease process. CONCLUSIONS: The histological changes may be distinguished from bronchiolitis obliterans and bronchiolitis obliterans organising pneumonia by the absence of intraluminal granulation tissue plugs, and from the obliterative bronchiolitis of rheumatoid disease and diffuse peribronchiolitis on clinical grounds. Although often striking, this lesion does not represent a clinico-pathological entity, and may occur in the distal lung in association with a number of different diseases. "Small airways disease" is often used by clinicians in a functional context, and may lead to confusion. It is suggested that "chronic transmural bronchiolitis" is a more appropriate term.