Genome-wide association studies (GWAS) have identified dozens of loci associated with chronic obstructive pulmonary disease (COPD) susceptibility; however, the function of associated genes in the cell type(s) affected in disease remains poorly understood, partly due to a lack of cell models that recapitulate human alveolar biology. Here, we apply CRISPR interference to interrogate the function of nine genes implicated in COPD by GWAS in induced pluripotent stem cell–derived type 2 alveolar epithelial cells (iAT2s). We find that multiple genes implicated by GWAS affect iAT2 function, including differentiation potential, maturation, and/or proliferation. Detailed characterization of the GWAS gene DSP demonstrates that it regulates iAT2 cell-cell junctions, proliferation, mitochondrial function, and response to cigarette smoke–induced injury. Our approach thus elucidates the biological function, as well as disease-relevant consequences of dysfunction, of genes implicated in COPD by GWAS in type 2 alveolar epithelial cells.