Pulmonary surfactant is a critical component of lung function in healthy individuals. It functions in part by lowering surface tension in the alveoli, thereby allowing for breathing with minimal effort. The prevailing thinking is that low surface tension is attained by a compression-driven squeeze-out of unsaturated phospholipids during exhalation, forming a film enriched in saturated phospholipids that achieves surface tensions close to zero. A thorough review of past and recent literature suggests that the compression-driven squeeze-out mechanism may be erroneous. Here, we posit that a surfactant film enriched in saturated lipids is formed shortly after birth by an adsorption-driven sorting process and that its composition does not change during normal breathing. We provide biophysical evidence for the rapid formation of an enriched film at high surfactant concentrations, facilitated by adsorption structures containing hydrophobic surfactant proteins. We examine biophysical evidence for and against the compression-driven squeeze-out mechanism and propose a new model for surfactant function. The proposed model is tested against existing physiological and pathophysiological evidence in neonatal and adult lungs, leading to ideas for biophysical research, that should be addressed to establish the physiological relevance of this new perspective on the function of the mighty thin film that surfactant provides.