Intermittent positive pressure ventilation with large tidal volumes and high peak airway pressures can result in pulmonary barotrauma. In the present study, we examined the hypothesis that ventilation at very low lung volumes can also worsen lung injury by repeated opening and closing of airway and alveolar duct units as ventilation occurs from below to above the infection point (Pinf) as determined from the inspiratory pressure-volume curve. We ventilated isolated, nonperfused, lavaged rat lungs with physiologic tidal volumes (5 to 6 ml/kg) at different end-expiratory pressures (above and below Pinf) and studied the effect on compliance and lung injury. In the groups ventilated with positive end-expiratory pressure (PEEP) below Pinf compliance fell dramatically after ventilation. It did not change in either the control group or the group ventilated with PEEP above Pinf. Lung injury assessed morphologically was significantly greater in the groups ventilated with a PEEP below Pinf, and in these groups the site of injury was dependent on the level of PEEP. The group ventilated without PEEP had significantly greater respiratory and membranous injury to bronchioles, while the group ventilated with PEEP of 4 cm H2O had significantly greater alveolar duct injury. In conclusion, ventilation at lung volumes below those found at Pinf caused a significant decrease in lung compliance and progression of lung injury. Therefore, in addition to high airway pressures, end-expiratory lung volume is an important determinant of the degree and site of lung injury during positive-pressure ventilation.