Chronic obstructive pulmonary disease (COPD) results in major remodeling of the distal airspaces and changes in the differentiation profile of the airway epithelium. The cellular and molecular mechanisms involved in initiation and progression of this disease are little understood. Although environmental factors, including cigarette smoke, have been directly implicated in the pathogenesis of COPD, genetic risk factors also appear to play a fundamental role in the individual's susceptibility to this disease. Lung development depends on precise coordination of signals, such as fibroblast growth factors (Fgf), Sonic Hedgehog (Shh), retinoic acid, Notch, and Tgf beta. Dramatic changes in the pattern of branching and differentiation of the lung epithelium results from disruption of these signals in genetically altered mice. Recent studies, including whole-genome expression and genome-wide association analyses, suggest that some molecular regulators originally described in developmental processes may be altered in patients with COPD. Whether disturbances in the molecular and cellular events mediated by these genes during development participate in the initiation or exacerbation of COPD, needs further investigation. The role of selected pathways, including Sonic hedgehog, Notch, retinoid, and Tgf beta in the developing lung and the potential association with COPD are discussed.