Rationale: Chronic obstructive pulmonary diseases are leading causes of death worldwide, but their pathogenesis is not well understood. Previous studies have shown that airway surface dehydration in ENaC overexpressing mice caused a chronic lung disease with high neonatal pulmonary mortality and chronic bronchitis in adult survivors. Objectives: The aim of this study was to identify the initiating lesions and investigate the natural progression of lung disease caused by airway surface dehydration. Methods: Lung morphology, gene expression, bronchoalveolar lavage and lung mechanics were studied at different ages in ENaC overexpressing mice. Measurements and Main Results: Mucus obstruction in ENaC overexpressing mice originated in the trachea in the first days of life and was associated with hypoxia, airway epithelial necrosis, and death. In surviving ENaC overexpressing mice, mucus obstruction extended into the lungs and was accompanied by goblet cell metaplasia, increased mucin expression, and airway inflammation with transient perinatal increases in TNF and macrophages, IL-13 and eosinophils, and persistent increases in KC, neutrophils, and chitinases in the lung. ENaC overexpressing mice also developed emphysema with increased lung volumes, distal airspace enlargement, and increased lung compliance. Conclusions: Our studies demonstrate that airway surface dehydration is sufficient to initiate persistent neutrophilic airway inflammation with chronic airways mucus obstruction, and cause transient eosinophilic airway inflammation, and emphysema. These results suggest that deficient airway surface hydration may play a critical role in the pathogenesis of chronic obstructive pulmonary diseases of different etiologies and serve as a target for novel therapies.