Mutations in the SFTPC gene associated with interstitial lung disease in human patients result in misfolding, ER retention and degradation of the encoded SP-C proprotein. In this study, genes specifically induced in response to transient expression of two disease-associated mutations were identified by microarray analyses. BiP and two HSP40 family members, ERdj4 and ERdj5, were significantly elevated and exhibited prolonged and specific association with the misfolded proprotein; in contrast, ERdj3 interacted with BiP but did not associate with either WT or mutant SP-C. Misfolded SP-C, ERdj4, and ERdj5 coprecipitated with p97/VCP indicating that the cochaperones remain associated with the misfolded proprotein until it is dislocated to the cytosol. Knockdown of ERdj4 and ERdj5 expression increased ER retention and inhibited degradation of misfolded SP-C but had little effect on the wild type protein. Transient expression of ERdj4 and ERdj5 in XBP-1(-/-) MEFs substantially restored rapid degradation of mutant SP-C proprotein whereas transfection of HPD mutants failed to rescue SP-C ERAD. ERdj4 and ERdj5 promote turnover of misfolded SP-C and this activity is dependent on their ability to stimulate BiP ATPase activity.