The mechanisms by which GM-CSF mediates bacterial clearance and inflammation during mycobacterial infection are poorly understood. The objective of this work was to determine how GM-CSF alters pulmonary mycobacterial infection in vivo. Differences in GM-CSF levels in the lungs of normal mice (GM^+/+), transgenic GM-CSF-deficient (GM-CSF^−/−), and transgenic mice with high GM-CSF expression only in lung epithelial cells (SP-C-GM-CSF^+/+/GM^−/−) did not affect pulmonary infection rates caused by either the attenuated Mycobacterium bovis BCG or the virulent Mycobacterium tuberculosis H37Rv. However, in contrast to findings with BCG, all GM-CSF^−/− and SP-C-GM-CSF^+/+/GM^−/− mice succumbed prematurely to virulent H37Rv. Granuloma formation was impaired in both GM-CSF^−/− and SP-C-GM-CSF^+/+/GM^−/− mice regardless of mycobacterial virulence. However, H37Rv-infected GM-CSF^−/− mice suffered broncho-alveolar destruction, edema, and necrosis while only short-lived granulomas were observed in SP-C-GM-CSF^+/+/GM^−/− mice. Bone marrow-derived macrophages, but not dendritic cells of SP-C-GM-CSF^+/+/GM^−/− mice, were hypo-responsive to mycobacterial infection. Surfactant protein levels were differentially influenced by BCG and H37Rv. We conclude that GM-CSF has an essential protective role first in preserving alveolar structure and second in regulating macrophages and dendritic cells to facilitate containment of virulent mycobacteria in pulmonary granulomas. However, precise regulation of lung GM-CSF is vital to effective control of M. tuberculosis.