Cell proliferation is an essential requirement for epithelial expansion and tubular branching; however, little is known of how these events are coupled during morphogenesis. We have previously shown that, in the absence of mesenchyme, fibroblast growth factor 1 (FGF-1) elicits budding of the mouse lung epithelium cultured in a basement membrane matrix. Although bud formation seems to be the manifestation of a localized response of lung epithelial cells to FGF-1, it is unclear whether budding results from induction of differential rates of cell proliferation within the epithelium. We performed continuous labeling and pulse-chase experiments in FGF-1-treated mesenchyme-free lung epithelial cultures at distinct stages of bud induction using bromodeoxyuridine (BrdU), to determine when and to what extent cell proliferation contributes to bud formation. When explants were incubated with BrdU either before bud induction (0-18 hr in culture) or at the onset of budding (24-30 hr), labeled nuclei were found distributed throughout the entire explant. In contrast, BrdU incubation after the onset of budding (30-48 hr) resulted in labeling concentrated in the budding areas, and a decrease of labeling toward the proximal region of the explant, between buds. These results demonstrate that differential rates of cell proliferation between bud and nonbud areas do not appear until when buds are almost completely formed. Thus, in the developing lung epithelium in vitro, bud outgrowth is not triggered by induction of localized cell proliferation.