Lung branching morphogenesis requires reciprocal interactions between the epithelium and mesenchyme. How the lung branches are generated at a defined location and projected toward a specific direction remains a major unresolved issue. In this study, we investigated the function of Wnt signaling in lung branching in mice. We discovered that Wnt5a in both the epithelium and the mesenchyme plays an essential role in controlling the position and direction of lung branching. The Wnt5a signal is mediated by Vangl1/2 to trigger a cascade of noncanonical or planar cell polarity (PCP) signaling. In response to noncanonical Wnt signaling, lung cells undergo cytoskeletal reorganization and change focal adhesions. Perturbed focal adhesions in lung explants are associated with defective branching. Moreover, we observed changes in the shape and orientation of the epithelial sheet and the underlying mesenchymal layer in regions of defective branching in the mutant lungs. Thus, PCP signaling helps define the position and orientation of the lung branches. We propose that mechanical force induced by noncanonical Wnt signaling mediates a coordinated alteration in the shape and orientation of a group of epithelial and mesenchymal cells. These results provide a new framework for understanding the molecular mechanisms by which a stereotypic branching pattern is generated.