Type II pneumocytes also called alveolar type II cells, great alveolar cells or septal cells are granular and roughly cuboidal in shape. Type II pneumocytes are typically found at the alveolar-septal junction. Although they comprise 60% of the alveolar lining cells, because of their shape they cover a much smaller surface area than type I cells (<5%).
Type II cells start to develop at about 24 weeks of gestation, secreting small amounts of surfactant. However, adequate amounts of surfactant are not secreted until about 35 weeks of gestation - this is the main reason for increased incidence rates of Infant respiratory distress syndrome, which drastically reduces at ages above 35 weeks gestation.
Type II cells are responsible for the production and secretion of surfactant (the majority of which are dipalmitoylphosphatidylcholine), a group of phospholipids that reduce the alveolar surface tension. Surfactant phospholipids are stored in Type II pneumocytes in lamellar bodies, which are specialized vesicles. Release of surfactant in lamellar bodies occurs from an infant's first breath onwards.
Type II pneumocytes can replicate in the alveoli and will replicate to replace damaged Type I pneumocytes.
MUC1, a human gene associated with type II pneumocytes, has been identified as a marker in lung cancer.