Group B streptococci (GBS) are the leading cause of serious bacterial infection in newborns. Early-onset disease is heralded by pneumonia and lung injury, and the lung may serve as a portal of entry for GBS into the bloodstream. To examine a potential role for GBS beta-hemolysin in lung epithelial injury, five wild-type strains varying in beta-hemolysin expression were chosen, along with five nonhemolytic (NH) and five hyperhemolytic (HH) variants of these strains derived by chemical or transposon mutagenesis. Monolayers of A549 alveolar epithelial cells were exposed to log-phase GBS or stabilized hemolysin extracts of GBS cultures, and cellular injury was assessed by lactate dehydrogenase (LDH) release and trypan blue nuclear staining. Whereas NH strains produced no detectable injury beyond baseline (medium alone), hemolysin-producing strains induced LDH release from A549 cells in direct correlation to their ability to lyse sheep erythrocytes. HH strains were also associated with marked increases in trypan blue nuclear staining of A549 monolayers. The extent of LDH release produced by HH strains was significantly reduced in the presence of dipalmitoyl phosphatidylcholine, a known inhibitor of hemolysin and the major phospholipid component of human surfactant. Electron microscopic studies of A549 cell monolayers exposed to HH GBS mutants revealed global loss of microvillus architecture, disruption of cytoplasmic and nuclear membranes, and marked swelling of the cytoplasm and organelles. We conclude that GBS hemolysin expression correlates with lung epithelial cell injury and may be important in the initial pathogenesis of early-onset disease, particularly when pulmonary surfactant is deficient.