Following injury, stem cells restore normal tissue architecture by producing the proper number and proportions of differentiated cells. Current models of airway epithelial regeneration propose that distinct cytokeratin 8-expressing progenitor cells, arising from p63⁺ basal stem cells, subsequently differentiate into secretory and ciliated cell lineages. We now show that immediately following injury, discrete subpopulations of p63⁺ airway basal stem/progenitor cells themselves express Notch pathway components associated with either secretory or ciliated cell fate commitment. One basal cell population displays intracellular Notch2 activation and directly generates secretory cells; the other expresses c-myb and directly yields ciliated cells. Furthermore, disrupting Notch ligand activity within the basal cell population at large disrupts the normal pattern of lineage segregation. These non-cell-autonomous effects demonstrate that effective airway epithelial regeneration requires intercellular communication within the broader basal stem/progenitor cell population. These findings have broad implications for understanding epithelial regeneration and stem cell heterogeneity.