Pulmonary surfactant contains less than 1 wt% of the very non-polar surfactant protein C (SP-C). In most animal species the major form of SP-C is a 35-residue peptide chain which contains two thioester-linked palmitoyl groups, giving a total molecular mass of 4.2 kDa. Several minor variants of SP-C exist, formed from N-terminal truncation, lysine palmitoylation, methionine oxidation and C-terminal esterification. The primary structure is evolutionarily conserved and SP-C appears to be the only constituent which is unique to pulmonary surfactant, indicating important and specific functions. The three-dimensional structure in an aqueous mixed organic solvent determined by NMR spectroscopy revealed one continuous 37 A long alpha-helix encompassing residues 9-34 as the only regular structural element. The central 23 A of the helix contains exclusively aliphatic residues with branched side-chains, mainly valines, and exposes an all-hydrophobic regular surface. The size of the entire helix perfectly matches the thickness of a fluid dipalmitoylphosphatidylcholine membrane, and the all-hydrophobic part of the helix matches the acyl-chain part of such a bilayer. This supports a transmembrane orientation of SP-C in pulmonary surfactant bilayers. In a phospholipid monolayer, the SP-C helix is tilted, thereby maximizing the interactions with the lipid acyl-chains also in this environment. The palmitoylcysteines of SP-C, which are located in the flexibly disordered N-terminal octapeptide segment, appear to be important both for integrity of the alpha-helical structure and for functional properties. Since the conformation of the N-terminal part in a phospholipid environment is not known, the mechanisms whereby the SP-C thioester-linked palmitoyl chains affect structure and function remain to be determined.