Alveolar macrophages (AMs) derive from fetal liver monocytes, which colonize the lung during embryonic development and give rise to fully mature AMs perinatally. AM differentiation requires granulocyte macrophage colony-stimulating factor (GM-CSF), but whether additional factors are involved in AM regulation is not known. Here we report that AMs, in contrast to most other tissue macrophages, were also dependent on transforming growth factor-β receptor (TGF-βR) signaling. Conditional deletion of TGF-βR in mice at different time points halted the development and differentiation of AMs. In adult mice, TGF-β was also critical for AM homeostasis. The source of TGF-β was AMs themselves, indicative of an autocrine loop that promotes AM self-maintenance. Mechanistically, TGF-βR signaling resulted in upregulation of PPAR-γ, a signature transcription factor essential for the development of AMs. These findings reveal an additional layer of complexity regarding the guidance cues, which govern the genesis, maturation, and survival of AMs.