The endoplasmic reticulum has evolved a number of mechanisms to manage the accumulation of incorrectly folded proteins. This results in loss of function of these proteins, but occasionally, in conditions such as α-1 antitrpysin (A1AT) deficiency, the misfolded protein can acquire a toxic gain of function promoting exaggerated ER stress responses and inflammation. Mutations leading to deficiency in a second serine proteinase inhibitor, α-1 antichymotrpysin (ACT), can induce potentially similar consequences. A1AT and ACT deficiencies are associated with chronic obstructive lung disease. Until recently, it was thought that the lung diseases associated with these conditions were entirely due to loss of antiprotease protection in the lung (i.e., loss of function), whereas gain of function was the major cause of the liver disease associated with A1AT deficiency. This paradigm is being increasingly challenged because ER stress is being recognized in bronchial epithelial cells and inflammatory cells normally resident in the lung, giving rise to an inflammatory phenotype that adds to the proteolytic burden associated with these conditions. In this article, we describe the cellular mechanisms that are activated to cope with an increasing burden of misfolded proteins within the ER in A1AT and ACT deficiency, show how these events are linked to inflammation, and outline the therapeutic strategies that can potentially interfere with production of misfolded proteins.