Chemical warfare agents (CWAs) as well as biological toxins present a significant inhalation injury risk to both deployed warfighters and civilian targets of terrorist attacks. Inhalation of many CWAs and biological toxins can induce severe pulmonary toxicity leading to the development of acute lung injury (ALI) as well as acute respiratory distress syndrome (ARDS). The therapeutic options currently used to treat these conditions are very limited and mortality rates remain high. Recent evidence suggests that human stem cells may provide significant therapeutic options for ALI and ARDS in the near future. The threat posed by CWAs and biological toxins for both civilian populations and military personnel is growing, thus understanding the mechanisms of toxicity and potential therapies is critical. This review will outline the pulmonary toxic effects of some of the most common CWAs and biological toxins as well as the potential role of stem cells in treating these types of toxic lung injuries.