In the respiratory tract, recognition of bacterial endotoxin (lipopolysacharide, LPS) is a critical step of the innate host defense system directed against invading pathogens. Secretions of the airways contain proteins that have direct antimicrobial activity (lysozyme, lactoferrin, defensins, and cathelicidins) as well as complement factors and surfactant proteins that contribute to host defense. The hydrophobic surfactant protein C (SP-C) recognizes LPS (Augusto, L., Le Blay, K., Auger, G., Blanot, D., and Chaby, R. (2001) Am. J. Physiol. 281, L776-L785). In the present study, using synthetic analogs of SP-C, we demonstrate that the palmitoyl residues of SP-C are not required for the interaction with LPS and that both the hydrophilic and hydrophobic regions of SP-C are required for specific binding of a radiolabeled rough-type LPS. In addition, using LPS submitted to different chemical treatments as well as synthetic analogs of the lipid A moiety of LPS, we established that the terminal phosphate group at the reducing end of the lipid A disaccharide in alpha configuration is of crucial importance for recognition by SP-C. The N-linked fatty acyl chain on the reducing glucosamine of lipid A also takes part in the interaction. Dipalmitoyl phosphatidylcholine is not specifically required for the LPS-binding activity of SP-C, although a lipid environment significantly increases the binding. These results provide a basis for experiments on the role of SP-C in presentation of LPS to alveolar cells and for the design of drugs for the management of endotoxin-induced lung injury.