Ventilator-induced lung injury (VILI) is an inflammatory process that can be attenuated by lung protective ventilation strategies. Our objectives to further investigate the pathogenesis of ALI and VILI and the mechanism of lung protection in these syndromes were: 1) to determine if plasma measurements of soluble TNF receptor I (sTNFRI) and II (sTNFRII) would predict the development of ALI and mortality in a small single center trial; 2) to test the predictive value of these markers and of TNF-α in a larger, broader group of patients with ALI; 3) to test the hypothesis that low tidal volume ventilation (LTVV) would be associated with a decrease in plasma levels of TNF-α, sTNFRI, and sTNFRII. In the single center study, sTNFRI and II levels were higher in patients at risk for and with ALI, but they did not predict the development of the syndrome. In the multicenter trial sTNFRI and II were strongly associated with mortality (OR 5.76/1 log10 increment in receptor level; 95% CI 2.63–12.6 and OR 2.58; 95% CI 1.05–6.31, respectively) and morbidity measured as fewer nonpulmonary organ failure-free and ventilator-free days. The LTVV strategy was associated with an attenuation of plasma sTNFRI levels. In vitro, stimulated A549 cells release sTNFRI but not sTNRFII. In conclusion, plasma levels of sTNFRI and II can serve as biomarkers for morbidity and mortality in patients with ALI. Furthermore, LTVV is associated with a specific decrease in sTNFRI levels. This suggests that one beneficial effect of LTVV may be to attenuate alveolar epithelial injury.