Freshly isolated rat type II pneumocytes, when grown on permeable tissue culture-treated polycarbonate filters, form confluent alveolar epithelial cell monolayers (RAECM). Cells in RAECM undergo transdifferentiation, exhibiting over time morphological and phenotypic characteristics of type I pneumocytes in vivo. We recently reported that transforming growth factor-beta(1) (TGF-beta(1)) decreases overall monolayer resistance (R(te)) and stimulates short-circuit current in a dose-dependent manner. In this study, we investigated the effects of TGF-beta(1) (50 pM) or 10% newborn bovine serum (NBS) on modulation of paracellular passive ion conductance and its contribution to total passive ion conductance across RAECM. On days 5-7 in culture, tight-junctional resistance (R(tj), kOmegacm(2)) of RAECM, cultured in minimally defined serum-free medium (MDSF) with or without TGF-beta(1) or NBS, was estimated from the relationship between observed transmonolayer voltage and resistance after addition of gramicidin D to apical potassium isethionate Ringer solution under open-circuit conditions. NaCl Ringer solution bathed the basolateral side throughout the experimental period. Results showed that transmonolayer conductance (1/R(te)) and tight-junctional conductance (1/R(tj)) are 0.59 and 0.14 mS/cm(2) for control monolayers in MDSF, 1.59 and 0.38 mS/cm(2) for monolayers exposed to TGF-beta(1), and 0.38 and 0.18 mS/cm(2) for monolayers grown in the presence of NBS. The contributions to total transepithelial ion conductance by the paracellular pathway are estimated to be 23, 23, and 47% for control, TGF-beta(1)-exposed, and newborn bovine serum (NBS)-treated RAECM, respectively.