This study investigates the cellular origins of alveolar type 2 (AT2) cells during lung repair and regeneration using a dual recombinase-mediated intersectional genetic lineage tracing approach. The authors found that AT1 cells, being terminally differentiated, do not contribute to AT2 cells after lung injury or repair. Instead, club cells and bronchioalveolar stem cells (BASCs) play crucial roles in regenerating AT2 cells. Club cells can contribute to the majority of alveoli after severe lung injuries, while BASCs contribute to a smaller but significant proportion. Mechanistically, Notch signaling inhibition promotes BASCs but impairs club cells' ability to generate AT2 cells during lung repair. The study provides precise genetic lineage tracing evidence, enhancing our understanding of pulmonary cell regeneration and potentially offering insights for disease therapy.This study investigates the cellular origins of alveolar type 2 (AT2) cells during lung repair and regeneration using a dual recombinase-mediated intersectional genetic lineage tracing approach. The authors found that AT1 cells, being terminally differentiated, do not contribute to AT2 cells after lung injury or repair. Instead, club cells and bronchioalveolar stem cells (BASCs) play crucial roles in regenerating AT2 cells. Club cells can contribute to the majority of alveoli after severe lung injuries, while BASCs contribute to a smaller but significant proportion. Mechanistically, Notch signaling inhibition promotes BASCs but impairs club cells' ability to generate AT2 cells during lung repair. The study provides precise genetic lineage tracing evidence, enhancing our understanding of pulmonary cell regeneration and potentially offering insights for disease therapy.