Keratinocyte growth factor (KGF) is an epithelial mitogen that has been reported to protect the lungs from a variety of insults. In this study, we tested the hypothesis that KGF augments pulmonary host defense. We found that a single dose of intrapulmonary KGF enhanced the clearance of Escherichia coli or Pseudomonas aeruginosa instilled into the lungs 24 h later. KGF augmented the recruitment, phagocytic activity, and oxidant responses of alveolar macrophages, including lipopolysaccharide-stimulated nitric oxide release and zymosan-induced superoxide production. Less robust alveolar macrophage recruitment and activation was observed in mice treated with intraperitoneal KGF. KGF treatment was associated with increased levels of MIP1γ, LIX, VCAM, IGFBP-6, and GM-CSF in the bronchoalveolar lavage fluid. Of these, only GM-CSF recapitulated in vitro the macrophage activation phenotype seen in the KGF-treated animals. The KGF-stimulated increase in GM-CSF levels in lung tissue and alveolar lining fluid arose from the epithelium, peaked within 1 h, and was associated with STAT5 phosphorylation in alveolar macrophages, consistent with epithelium-driven paracrine activation of macrophage signaling through the KGF receptor/GM-CSF/GM-CSF receptor/JAK-STAT axis. Enhanced bacterial clearance did not occur in response to KGF administration in GM-CSF(-/-) mice, or in mice treated with a neutralizing antibody to GM-CSF. We conclude that KGF enhances alveolar host defense through GM-CSF-stimulated macrophage activation. KGF administration may constitute a promising therapeutic strategy to augment innate immune defenses in refractory pulmonary infections.