Background. We investigated endobronchial transfection of CAT and TGF-β1 cDNA selectively delivered to the lung graft with or without liposomes. Methods. Phase I: F344 rats received 130 μg of naked plasmid pCF1-CAT or complexed to liposome GL67 via left main bronchus instillation. Rats were awakened (pCF1-CAT, n = 4; GL67:pCF1-CAT, n = 4) or served as donors in an isogenic transplant (pCF1-CAT, n = 5; GL67:pCF1-CAT, n = 5). ELISA was performed on lungs, hearts, and livers on POD 2. Phase II: BN lungs received TGF-β1 sense (n = 6); antisense (n = 5); GL67:TGF-β1 sense (n = 10); or saline solution (n = 10). F344 recipients were sacrificed on POD 5. The arterial pO2 and rejection were assessed. RT-PCR for murine TGF-β1 was performed. Results. Phase I: CAT expression was 519 ± 287 pg and 63 ± 68 with pCF1-CAT and 104 ± 67 and 37 ± 45 with GL67:pCF1-CAT, respectively, in the non-transplant and in the transplant setting. No protein was detected in the hearts, livers, and in the native lung of the recipients. Phase II: RT-PCR confirmed murine TGF-β1 transfection. pO2 was 362.7 ± 110.2 (mean mmHg ± SD) for sense TGF-β1; 146.88 ± 85.5 for antisense; 241.5 ± 181.5 for GL67-TGF-β1 sense; and 88.4 ± 38.7 for saline. TGF- β1 sense versus all other groups, p < 0.05, GL67-TGF-β1 sense versus saline, p = 0.01. Rejection was significantly lower for TGF-β1 sense versus saline, p = 0.04. Conclusions. Endobronchial administration of naked plasmid achieves selective transfection of lung grafts. Using this strategy, TGF-β1 reduces early lung allograft rejection.