Lymphangioleiomyomatosis (LAM) is a rare multisystem disease with a variable clinical course. The lungs are infiltrated by nodules of LAM cells, stromal cells and inflammatory cells, causing lung cysts and respiratory failure. We used immunohistochemical markers in lung biopsy and transplant samples from a national cohort of women with LAM with linked clinical data to understand how LAM nodule cell populations changed with disease progression. Marker distribution was examined qualitatively by dual immunohistochemistry, and markers for LAM cells, fibroblasts, lymphatics, mast cells, proliferation, cathepsin K and mTOR pathway activity were quantitated in LAM nodules and compared with clinical features and prospective lung function loss. The LAM cell marker PNL2 was more extensively expressed in those with higher forced expiratory volume in one second (FEV1), higher diffusion in the lung for carbon monoxide (DLCO) and less extensive disease involvement whilst the converse was true for the protease cathepsin K. Each percentage increase in cathepsin K reactivity was associated with a 0.65% decrease in FEV1 (95% CI −1.11 to −0.18) and a 0.50% decrease in DLCO (95% CI −0.96 to −0.05). Higher reactivity to the mTOR complex 1 activation marker, phospho-ribosomal protein S6, was associated with a better lung function response to rapamycin (p = 0.0001). We conclude that LAM nodules evolve with disease progression, with LAM cells becoming outnumbered by fibroblasts. Increasing cathepsin K expression is associated with more severe disease and lung function loss. Markers of mTOR activation predict the response to rapamycin, suggesting that more advanced LAM may be less mTOR responsive and treatments specifically targeted towards LAM associated fibroblasts may have roles as adjuncts to mTOR inhibition.