Idiopathic pulmonary fibrosis (IPF) is characterized by impaired alveolar type 2 cell regeneration. However, robust in vitro models of human distal lung epithelium are limited. In this study, we generated immortalized AT2 cell lines from healthy and IPF lungs using HTII-280 sorting and SV40 large T antigen transduction. These lines retain key features of alveolar epithelial biology in both 2D and 3D cultures, including self-renewal, differentiation, and transitional cell states. They form 3D organoids efficiently under optimized feeder-free, serum-free medium conditions, with higher colony-forming capacity in healthy AT2 cell lines comparing with IPF AT2 cell lines. These accessible models recapitulate alveolar epithelial biology, offering a platform for cell-biology research and therapeutic development in lung diseases.