The present invention relates to a method for the production of differentiated respiratory epithelial cells comprising: (a) providing a cell population comprising or consisting of precursor cells of respiratory epithelial cells; (b) culturing the cell population of (a) in culture medium to which keratinocyte growth factor has been added; wherein the cultured cell population is supplemented with a glucocorticoid, a cAMP analog and a cAMP elevating agent and wherein said supplementation is either simultaneously with the addition of keratinocyte growth factor in step (b) or prior or subsequently to the addition of keratinocyte growth factor in step (b), thereby differentiating said precursor cells into respiratory epithelial cells. The present invention further relates to the cell(s) obtained by the method of the invention for use in treating or preventing a respiratory disease and to a method for identifying a compound having an pharmacological, cytotoxic, proliferative, transforming or differentiating effect on the differentiated respiratory epithelial cells obtained by the method of the invention.