Respiratory syncytial virus (RSV) infection is the major cause of bronchiolitis in young children. The factors contributing to increased propensity of RSV-induced distal airway disease compared to other commonly encountered respiratory viruses are unknown. Using a model of the well-differentiated airway epithelium, we characterized the consequences of RSV infection of ciliated epithelial cells, the primary cellular targets of RSV infection in vivo. These studies show that RSV infection results in cell rounding and degradation of the cilia apparatus, followed by active extrusion of infected cells from the epithelium, eventually resulting in a decline in the ability of the airway epithelium to perform mucociliary transport. Using recombinant respiratory viruses, we attribute these consequences to the RSV non-structural 2 (NS2) protein. Using parainfluenza virus 3 (PIV3) to deliver and express RSV NS2 in the ciliated epithelium of hamster airways, we assessed the impact of NS2 on respiratory viral pathogenesis. These studies identified the RSV NS2 protein as a unique viral genetic determinant for RSV-induced pathogenesis, resulting in two distinct effects in vivo. First, NS2 promoted epithelial cell extrusion and accelerated clearance of whole lung virus titers, presumably by clearing virus-infected cells from the airway mucosa. Second, epithelial cell extrusion promoted by NS2 resulted in accumulation of detached, pleomorphic epithelial cells in the narrow diameter bronchiolar airway lumen, resulting in acute distal airway obstruction. Finally, we identify a role for NS2 in mediating early and robust neutrophilic influx, which may contribute to distal airway obstruction and constriction. These studies reveal a novel consequence of RSV infection of the airway epithelium, where NS2-promoted epithelial cell shedding and morphologic changes accelerate viral clearance but also cause acute distal airway obstruction. NS2-promoted epithelial cell shedding in the distal airways and the resulting obstruction of these airways represent a mechanism that may explain why RSV is the dominant virus causing bronchiolitis in young children. We identify for the first time NS2 as a pathogenesis factor for increasing the likelihood for small airway obstruction during RSV infection.