Morphogenesis and regeneration share a conserved core transition cell state program that controls lung epithelial cell fate.

Transitional cell states are at the crossroads of crucial developmental and regenerative events, yet little is known about how these states emerge and influence outcomes. The alveolar and airway epithelia arise from distal lung multipotent progenitors, which undergo cell fate transitions to form these distinct compartments. The identification and impact of cell states in the developing lung are poorly understood. Here, we identified a population of Icam1/Nkx2-1 epithelial progenitors harboring a transitional state program remarkably conserved in humans and mice during lung morphogenesis and regeneration. Lineage-tracing and functional analyses reveal their role as progenitors to both airways and alveolar cells and the requirement of this transitional program to make distal lung progenitors competent to undergo airway cell fate specification. The identification of a common progenitor cell state in vastly distinct processes suggests a unified program reiteratively regulating outcomes in development and regeneration.