Various means have been used to encourage the differentiation of embryonic stem cells (ESCs) toward specific lineages, including growth factor administration, genetic modification, and coculture with relevant cells/tissues. Cell extract-based reprogramming has recently been used to derive mature cells from nonrelated phenotypes. In this communication, we tested whether this in vitro reprogramming approach can be used to direct ESC differentiation. Permeabilized murine ESCs exposed to extracts of murine type II pneumocytes showed increased expression of surfactant protein C and its corresponding mRNA, reflecting enhanced differentiation of pneumocytes. Subsequent differentiation to a type I phenotype was demonstrated by expression of aquaporin 5. Pneumocyte formation occurred quicker than with growth factor-induced differentiation. Our findings establish that ESCs can be differentiated in vitro using cellular extracts. This model provides a tool for analysis of the key factors involved in the differentiation of ESCs to type II pneumocytes.