[epmaybe]

That's where Angiotensin I (ACE = Angiotensin Converting Enzyme) is converted to Angiotensin II, which acts on tons of blood vessels to increase blood pressure. That's essentially why ACE inhibitors have a blood pressure effect. On top of that, Bradykinin is an inflammatory mediator that is degraded by ACE. It's heavily implicated in the side effect ACE inhibitors have of dry cough.

[wbl]

But why the lungs and not the liver?

[epmaybe]

Now that is a very interesting question! Unfortunately, I don't think that we have a complete answer. A couple of notes, that perhaps can provide some perspective:

1. lungs are highly vascularised areas with a large amount of vascular endothelium, making them a great location to express ACE if you want to convert as much angiotensin I as you can in the space of a heartbeat (which you'd like to do if your blood pressure dropped, for example).

2. ACE is not specific for angiotensin, it acts on a variety of peptides. Bradykinin is a good example as it can provide more perspective on why ACE is expressed mainly in lung tissue. Bradykinin acts to contract smooth muscle in your airways. Thus, degrading bradykinin via ACE is a good way to improve your breathing.