Though many lung diseases are associated with hypoxia, alveolar type II epithelial (ATII) cell impairment, and pulmonary surfactant dysfunction, the effects of oxygen limitation on metabolic pathways necessary to maintain cellular energy in ATII cells have not been studied extensively. This report presents results of targeted assays aimed at identifying specific metabolic processes that contribute to energy homeostasis using primary ATII cells and a model ATII cell line, MLE-15, cultured in normoxic and hypoxic conditions. MLEs cultured in normoxia demonstrated a robust oxygen consumption rate (OCR) coupled to ATP generation and limited extracellular lactate production, indicating reliance on oxidative phosphorylation for ATP production. Pharmacological uncoupling of respiration increased OCR in normoxic cultures to 175% of basal levels, indicating significant spare respiratory capacity. However, when exposed to hypoxia for 20 hours, basal oxygen consumption fell to 60% of normoxic rates and cells maintained only ~50% of normoxic spare respiratory capacity, indicating suppression of mitochondrial function, though intracellular ATP levels remained at near normoxic levels. Moreover, while hypoxic exposure stimulated glycogen synthesis and storage in MLE-15, glycolytic rate (as measured by lactate generation) was not significantly increased in the cells, despite enhanced expression of several enzymes related to glycolysis. These results were largely recapitulated in murine primary ATII, demonstrating MLE-15 suitability for modeling ATII metabolism. The ability of ATII cells to maintain ATP levels in hypoxia without enhancing glycolysis suggests that these cells are exceptionally efficient at conserving ATP in order to maintain bioenergetic homeostasis under O₂-limitation.