The factors regulating growth of the developing lung are poorly understood, although the degree of fetal lung expansion is critical. The oncogene Trop2 (trophoblast antigen 2) is upregulated during accelerated fetal lung growth, and we hypothesized that it may regulate normal fetal lung growth. We investigated Trop2 expression in the fetal and neonatal sheep lung during accelerated and delayed lung growth induced by alterations in fetal lung expansion, as well as in response to glucocorticoids. Trop2 expression was measured using real-time PCR and localized spatially using in situ hybridization and immunofluorescence. During normal lung development, Trop2 expression was higher at 90 days gestational age (GA; 4.0 +/- 0.8) than at 128 days GA (1.0 +/- 0.1), decreased to 0.5 +/- 0.1 at 142 days GA (full term approximately 147 days GA), and was positively correlated to lung cell proliferation rates (r = 0.953, P < 0.005). Trop2 expression was regulated by fetal lung expansion, but not by glucocorticoids. It was increased nearly threefold by 36 h of increased fetal lung expansion (P < 0.05) and was reduced to approximately 55% of control levels by reduced fetal lung expansion (P < 0.05). Trop2 expression was associated with lung cell proliferation during normal and altered lung growth, and the TROP2 protein colocalized with Ki-67-positive cells in the fetal lung. TROP2 was predominantly localized to fibroblasts and type II alveolar epithelial cells. Trop2 small interfering RNA decreased Trop2 expression by approximately 75% in cultured fetal rat lung fibroblasts and decreased their proliferation by approximately 50%. Cell viability was not affected. This study demonstrates that TROP2 regulates lung cell proliferation during development.