Significance Human mutations in SOX9 lead to several congenital disorders, including campomelic dysplasia. Babies born with this condition often die of respiratory distress; however, defects in lung development have thus far not been reported in mouse models. Here, we report that epithelial-specific deletion of Sox9 leads to developmental abnormalities in the lung during branching morphogenesis. We demonstrate that Sox9 plays multiple roles in the lung epithelium, balancing proliferation and differentiation and regulating the extracellular matrix. Therefore, our work highlights a role for Sox9 during lung branching morphogenesis, making this a useful model to study defects associated with a congenital disorder affecting humans.