It has been shown that branching morphogenesis of the lung bud is mediated by epithelial-mesenchymal interaction via such molecules as FGF10, BMP4 and Shh. However, a recent study showed that the isolated lung epithelium still undergoes branching morphogenesis in vitro even in the absence of mesenchyme (Nogawa and Ito, 1995). In the present study, we observed in vitro the dynamic movement of the isolated lung epithelium of the fetal mouse using time-lapse recording, and investigatedthe roles of actinfilaments in branching of the lung bud. First, time-lapse observation of the initial phase of lung branching morphogenesis revealed that at the sites of cleft formation, the epithelial surface was retracted inward from its original position. From this observation we assumed that there should be some structures which exert a physical force on the epithelium, and the localization and arrangement of actin fibers in the cultured lung epithelium were examined at various stages of branching morphogenesis. At the prebudding (6 h) and onset-budding (24 h) stages, no specific localization of actin filaments was observed in the lung bud epithelium, but at the postbudding stage (48 h) they were localized densely in the cells at the tip of the branched lung epithelium. The cell density was not different between the tip and cleft regions of the lung bud epithelium. When cultured with FGF-soaked beads, an actin-rich region was induced at the tip of the lung bud which was growing toward an FGF-soaked bead. These results indicate that actin fibers do not play a significant part in cleft formation but can be secondarily induced by FGF in the surrounding matrix and play some roles at later shaping of the branch in lung morphogenesis.