Alveolar epithelial cells (AEC) have been implicated in pathological remodelling. We examined the capacity of AEC to produce extracellular matrix (ECM) and thereby directly contribute towards remodelling in chronic lung diseases. Cryopreserved type 2 AEC (AEC2) from healthy lungs and chronic obstructive pulmonary disease (COPD) afflicted lungs were cultured in decellularized healthy human lung slices for 13 days. Healthy-derived AEC2 were treated with transforming growth factor ß1 (TGF-β1) to evaluate the plasticity of their ECM production. Evaluation of phenotypic markers and expression of matrisome genes and proteins were evaluated by RNA-sequencing, mass spectrometry and immunohistochemistry. The AEC2 displayed an AEC marker profile similar to freshly isolated AEC2 throughout the 13-day culture period. COPD-derived AECs proliferated as healthy AECs with few differences in gene and protein expression while retaining increased expression of disease marker HLA-A. The AEC2 expressed basement membrane components and a complex set of interstitial ECM proteins. TGF-β1 stimuli induced a significant change in interstitial ECM production from AEC2 without loss of specific AEC marker expression. This study reveals a previously unexplored potential of AEC to directly contribute to ECM turnover by producing interstitial ECM proteins, motivating a re-evaluation of the role of AEC2 in pathological lung remodelling.