Airway epithelial cells are important in immune homeostasis in that they dampen immune activation by clearing dying cells and producing anti-inflammatory cytokines. Airway epithelial cells have been shown to activate immune responses on exposure to inhaled antigens. Kodi Ravichandran and colleagues now demonstrate that they also have an important role in immune homeostasis by dampening immune activation through clearing dying cells and secreting anti-inflammatory cytokines. These functions depend on the GTPase Rac1. Activated epithelial cells lacking Rac1 produce less of the anti-inflammatory cytokine interleukin-10, and express higher levels of interleukin-33, correlating with higher numbers of innate lymphocytes and enhanced airway inflammation in response to inhaled allergens. This work also suggests that apart from a physical barrier, phagocytosis in the airways may be part of an additional line of immune protection against innocuous antigens. Lung epithelial cells can influence immune responses to airway allergens1,2. Airway epithelial cells also undergo apoptosis after encountering environmental allergens3; yet, relatively little is known about how these are cleared, and their effect on airway inflammation. Here we show that airway epithelial cells efficiently engulf apoptotic epithelial cells and secrete anti-inflammatory cytokines, dependent upon intracellular signalling by the small GTPase Rac1. Inducible deletion of Rac1 expression specifically in airway epithelial cells in a mouse model resulted in defective engulfment by epithelial cells and aberrant anti-inflammatory cytokine production. Intranasal priming and challenge of these mice with house dust mite extract or ovalbumin as allergens led to exacerbated inflammation, augmented Th2 cytokines and airway hyper-responsiveness, with decreased interleukin (IL)-10 in bronchial lavages. Rac1-deficient epithelial cells produced much higher IL-33 upon allergen or apoptotic cell encounter, with increased numbers of nuocyte-like cells1,4,5. Administration of exogenous IL-10 ‘rescued’ the airway inflammation phenotype in Rac1-deficient mice, with decreased IL-33. Collectively, these genetic and functional studies suggest a new role for Rac1-dependent engulfment by airway epithelial cells and in establishing the anti-inflammatory environment, and that defects in cell clearance in the airways could contribute to inflammatory responses towards common allergens.