Key points Hydrocortisone (HC) is required for activation of large‐conductance Ca2+‐activated K+ current (BK) by purinergic receptor agonists. HC reduces insertion of the stress‐regulated exon (STREX) in the KCNMA1 gene, permitting protein kinase C (PKC)‐dependent channel activation. Overlapping and unique purinergic signalling regions exist at the apical border of differentiated surface cells. BK channels localize in the cilia of surface cells. Abstract In the present study we investigated the role of hydrocortisone (HC) on uridine‐5ʹ‐triphosphate (UTP)‐stimulated ion transport in differentiated, pseudostratified epithelia derived from normal human bronchial basal cells. The presence of a UTP‐stimulated, paxilline‐sensitive large‐conductance Ca2+‐activated K+ (BK) current was demonstrated in control epithelia but was not stimulated in epithelia differentiated in the absence of HC (HC0). Addition of the BK channel opener NS11021 directly activated channels in control epithelia; however, under HC0 conditions, activation only occurred when UTP was added after NS11021. The PKC inhibitors GF109203x and Gö6983 blocked BK activation by UTP in control epithelia, suggesting that PKC‐mediated phosphorylation plays a permissive role in purinoceptor‐stimulated BK activation. Moreover, HC0 epithelia expressed significantly more KCNMA1 containing the stress‐regulated exon (STREX), a splice‐variant of the α‐subunit that displays altered channel regulation by phosphorylation, compared to control epithelia. Furthermore, BK channels as well as purinergic receptors were shown to localize in unique and overlapping domains at the apical membrane of ciliated surface cells. These results establish a previously unrecognized role for glucocorticoids in regulation of BK channels in airway epithelial cells.