Epithelial dysfunction in the small airways may cause the development of emphysema in chronic obstructive pulmonary disease. C/EBPα (CCAAT/enhancer binding protein-α), a transcription factor, is required for lung maturation during development, and is also important for lung homeostasis after birth, including the maintenance of serine protease/antiprotease balance in the bronchiolar epithelium. This study aimed to show the roles of C/EBPα in the distal airway during chronic cigarette smoke exposure in mice and in the small airways in smokers. In a model of chronic smoke exposure using epithelial cell-specific C/EBPα-knockout mice, significant pathological phenotypes, such as higher protease activity, impaired ciliated cell regeneration, epithelial cell barrier dysfunction via reduced zonula occludens-1 (Zo-1), and decreased alveolar attachments, were found in C/EBPα-knockout mice compared with control mice. We found that Spink5 (serine protease inhibitor kazal-type 5) gene (encoding lymphoepithelial Kazal-type-related inhibitor [LEKTI], an anti-serine protease) expression in the small airways is a key regulator of protease activity in this model. Finally, we showed that daily antiprotease treatment counteracted the phenotypes of C/EBPα-knockout mice. In human studies, CEBPA (CCAAT/enhancer binding protein-α) gene expression in the lung was downregulated in patients with emphysema, and six smokers with centrilobular emphysema (CLE) showed a significant reduction in LEKTI in the small airways compared with 22 smokers without CLE. LEKTI downregulation in the small airways was associated with disease development during murine small airway injury and CLE in humans, suggesting that LEKTI might be a key factor linking small airway injury to the development of emphysema.