Smoking is a significant risk factor for lung cancer, the leading cause of cancer-related deaths worldwide. Although microRNAs are regulators of many airway gene-expression changes induced by smoking, their role in modulating changes associated with lung cancer in these cells remains unknown. Here, we use next-generation sequencing of small RNAs in the airway to identify microRNA 4423 (miR-4423) as a primate-specific microRNA associated with lung cancer and expressed primarily in mucociliary epithelium. The endogenous expression of miR-4423 increases as bronchial epithelial cells undergo differentiation into mucociliary epithelium in vitro, and its overexpression during this process causes an increase in the number of ciliated cells. Furthermore, expression of miR-4423 is reduced in most lung tumors and in cytologically normal epithelium of the mainstem bronchus of smokers with lung cancer. In addition, ectopic expression of miR-4423 in a subset of lung cancer cell lines reduces their anchorage-independent growth and significantly decreases the size of the tumors formed in a mouse xenograft model. Consistent with these phenotypes, overexpression of miR-4423 induces a differentiated-like pattern of airway epithelium gene expression and reverses the expression of many genes that are altered in lung cancer. Together, our results indicate that miR-4423 is a regulator of airway epithelium differentiation and that the abrogation of its function contributes to lung carcinogenesis.