Rabbits were exposed to 0.6 mg/m3 of nickel as NiCl2 for about one month. After exposure, alveolar macrophages were lavaged from the lung and divided into three fractions by elutriation. Laminated structures in the macrophages were related to fraction number so that the fractions with the largest cells contained the highest number of structures. The lysozyme activity decreased in unfractionated as well as in fractionated macrophages from nickel exposed rabbits. The decrease was most pronounced in the fraction with the smallest macrophages and smallest number of laminated structures. Therefore the pronounced decrease in lysozyme activity seen in this and earlier studies is not caused by the increased amount of surfactant material. Increased amount of surfactant is a hallmark of nickel inhalation exposure and the surfactant material is responsible for the morphological and metabolic effects of the macrophages. The decreased lysozyme activity is probably a direct effect of nickel on the macrophages.