Pulmonary alveolar macrophages (PAM) play a central role in host defense against pulmonary infection. The authors studied the number, viability, and ultrastructure of PAM recovered by bronchoalveolar lavage from normal and HIV-infected subjects, and their ability to phagocytose and kill Staphylococcus aureus. PAM from HIV-infected subjects who did not have pneumonia were present in greater numbers and phagocytosed significantly more opsonized Staphylococcus aureus (32.5% and 27.3% for nonsmokers and smokers, respectively) than did PAM from healthy controls (19.5% and 18.2%). In 15 patients with AIDS and pneumonia (due to Pneumocystis carinii in 13/15), viability of PAM and their phagocytic capacity were significantly reduced; in smokers with AIDS and pneumonia, the PAM yield was also dramatically decreased. Killing of S. aureus was similar by PAM from all patient groups. HIV infection was associated with the electron microscopic finding in PAM of extensively ruffled PAM cell-surfaces and ingestion of lymphocytes. Thus, HIV infection stimulates the phagocytic capacity and produces morphologic changes consistent with the possibility that PAM are activated by this retroviral infection. In patients with AIDS who develop pneumonia, especially in smokers, the number, viability and phagocytic capacity of PAM are significantly decreased; our study could not determine whether this diminished activity reflects evolution of the HIV infection or a secondary effect of the pneumonia.