Hypoxia exists when there is a reduced amount of oxygen in the tissues of the body. Hypoxemia refers to a reduction in PO2 below the normal range, regardless of whether gas exchange is impaired in the lung, CaO2 is adequate, or tissue hypoxia exists. There are several potential physiologic mechanisms for hypoxemia, but in patients with COPD the predominant one is V/Q mismatching, with or without alveolar hypoventilation, as indicated by PaCO2. Hypoxemia caused by V/Q mismatching as seen in COPD is relatively easy to correct, so that only comparatively small amounts of supplemental oxygen (less than 3 L/min for the majority of patients) are required for LTOT. Although hypoxemia normally stimulates ventilation and produces dyspnea, these phenomena and the other symptoms and signs of hypoxia are sufficiently variable in patients with COPD as to be of limited value in patient assessment. Chronic alveolar hypoxia is the main factor leading to development of cor pulmonale--right ventricular hypertrophy with or without overt right ventricular failure--in patients with COPD. Pulmonary hypertension adversely affects survival in COPD, to an extent that parallels the degree to which resting mean pulmonary artery pressure is elevated. Although the severity of airflow obstruction as measured by FEV1 is the best correlate with overall prognosis in patients with COPD, chronic hypoxemia increases mortality and morbidity for any severity of disease. Large-scale studies of LTOT in patients with COPD have demonstrated a dose-response relationship between daily hours of oxygen use and survival. There is reason to believe that continuous, 24-hours-per-day oxygen use in appropriately selected patients would produce a survival benefit even greater than that shown in the NOTT and MRC studies.