SARS-CoV-2 has become a major problem across the globe, with approximately 50 million cases and more than 1 million deaths and currently no approved treatment or vaccine. Chronic obstructive pulmonary disease (COPD) is one of the underlying conditions in adults of any age that place them at risk for developing severe illness associated with COVID-19. We established an airway epithelium model to study SARS-CoV-2 infection in healthy and COPD lung cells. We found that both the entry receptor ACE2 and the co-factor transmembrane protease TMPRSS2 are expressed at higher levels on nonciliated goblet cell, a novel target for SARS-CoV-2 infection. We observed that SARS-CoV-2 infected goblet cells and induced syncytium formation and cell sloughing. We also found that SARS-CoV-2 replication was increased in the COPD airway epithelium likely due to COPD associated goblet cell hyperplasia. Our results reveal goblet cells play a critical role in SARS-CoV-2 infection in the lung.