The mechanistic target of rapamycin (mTOR) is a central regulator of cellular responses to environmental stress. mTOR (and its primary complex mTORC1) is, therefore, ideally positioned to regulate lung inflammatory responses to an environmental insult, a function directly relevant to disease states such as the acute respiratory distress syndrome. Our previous work in cigarette smoke-induced emphysema identified a novel protective role of pulmonary mTORC1 signaling. However, studies of the impact of mTORC1 on the development of acute lung injury are conflicting. We hypothesized that Rtp801, an endogenous inhibitor of mTORC1, which is predominantly expressed in alveolar type II epithelial cells, is activated during endotoxin-induced lung injury and functions to suppress anti-inflammatory epithelial mTORC1 responses. We administered intratracheal lipopolysaccharide to wild-type mice and observed a significant increase in lung Rtp801 mRNA. In lipopolysaccharide-treated Rtp801(-/-) mice, epithelial mTORC1 activation significantly increased and was associated with an attenuation of lung inflammation. We reversed the anti-inflammatory phenotype of Rtp801(-/-) mice with the mTORC1 inhibitor, rapamycin, reassuring against mTORC1-independent effects of Rtp801. We confirmed the proinflammatory effects of Rtp801 by generating a transgenic Rtp801 overexpressing mouse, which displayed augmented inflammatory responses to intratracheal endotoxin. These data suggest that epithelial mTORC1 activity plays a protective role against lung injury, and its inhibition by Rtp801 exacerbates alveolar injury caused by endotoxin.