Chronic obstructive pulmonary disease (COPD) is characterized physiologically by expiratory flow limitation and pathologically by alveolar destruction and enlargement and small and large airway inflammation and remodeling. An imbalance between protease and antiprotease activity in the lung is proposed as the major mechanism resulting in emphysema. The imbalance is mostly due to an increase in the numbers of alveolar macrophages and neutrophils. Emphysema can also develop from increased alveolar wall cell death and/or failure in alveolar wall maintenance. Chronic inflammation and increased oxidative stress contribute to increased destruction and/or impaired lung maintenance and repair. Genetic factors may play an important role in disease susceptibility because only a minority of smokers develops emphysema. Recent literature implicates surfactant instability, malnutrition, and alveolar cell apoptosis as possible etiologies. Identification of cellular and molecular mechanisms of COPD pathogenesis is an area of active, ongoing research that may help to determine therapeutic targets for emphysema.