Epithelial organs including the lung are known to possess regenerative abilities through activation of endogenous stem cell populations but the molecular pathways regulating stem cell expansion and regeneration are not well understood. Here we show that Gata6 regulates the temporal appearance and number of bronchioalveolar stem cells (BASCs) in the lung leading to the precocious appearance of BASCs and concurrent loss in epithelial differentiation in Gata6 null lung epithelium. This expansion of BASCs is the result of a dramatic increase in canonical Wnt signaling in lung epithelium upon loss of Gata6. Expression of the non-canonical Wnt receptor Fzd2 is down-regulated in Gata6 mutants and increased Fzd2 or decreased -catenin expression rescues, in part, the lung epithelial defects in Gata6 mutants. During lung epithelial regeneration, we show that canonical Wnt signaling is activated in the niche containing BASCs and forced activation of Wnt signaling leads to a dramatic increase in BASC numbers. Moreover, Gata6 is required for proper lung epithelial regeneration and postnatal loss of Gata6 leads to increased BASC expansion and decreased differentiation. Together, these data demonstrate that Gata6 regulated Wnt signaling controls the balance between stem/progenitor expansion and epithelial differentiation required for both lung development and regeneration.