Lung endothelial cells (ECs) and pericytes are closely juxtaposed with the respiratory epithelium before birth and thus may have instructive roles during development. To test this hypothesis, we screened EC-secreted proteins for their ability to alter cell differentiation in alveolar organoids. We identified secreted protein acidic and rich in cysteine-like protein 1 (SPARCL1) as an extracellular matrix molecule that can promote alveolar type 2 (AT2) cell differentiation in vitro. SPARCL1-treated organoids display lysozyme upregulation and a doubling in the number of AT2 cells at the expense of intermediate progenitors. SPARCL1 also induces the upregulation of nuclear factor
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