Respiratory pathogens and toxins often assault the lung from the airway lumen. Airway epithelia may initiate and amplify inflammation in response to these attacks, but under certain conditions confinement of inflammation to the airway lumen may be beneficial to the host. Accordingly, we hypothesized that airway epithelial polarity allows different responses to basolateral vs apical stimuli that may modulate inflammation. Using primary human airway epithelial cells differentiated at an air-liquid interface in culture, we found that respoases to several cytokines required basolateral mediator application. In contrast, responses to Haemophilus influenzae occurred after either basolateral or apical interaction with airway epithelia. Experiments focused on IFN-γ receptor polarity confirmed its predominant basolateral location in cultured airway epithelia as well as in normal human airway tissue. Furthermore, physical and pharmacologic disruption of barrier function in airway epithelia allowed responses to apical application of IFN-γ and other cytokines. These in vitro studies directly correlated with experiments in mice in which an airway epithelial response to IFN-γ injected into the airway lumen was seen only after disruption of barrier function. The results indicate that airway epithelia with intact barrier function restrict inflammatory responses by limitation of cell activation through requiring interaction of selected mediators with the basolateral surface. However, loss of barrier integrity allows epithelial responses to these mediators if located in the airway lumen to amplify airway defenses.