The field of pulmonary gas exchange is mature, with the basic principles developed more than 60 years ago. Arterial blood gas measurements (tensions and concentrations of O2 and CO2) constitute a mainstay of clinical care to assess the degree of pulmonary gas exchange abnormality. However, the factors that dictate arterial blood gas values are often multifactorial and complex, with six different causes of hypoxaemia (inspiratory hypoxia, hypoventilation, ventilation/perfusion inequality, diffusion limitation, shunting and reduced mixed venous oxygenation) contributing variably to the arterial O2 and CO2 tension in any given patient. Blood gas values are then usually further affected by the body's abilities to compensate for gas exchange disturbances by three tactics (greater O2 extraction, increasing ventilation and increasing cardiac output). This article explains the basic principles of gas exchange in health, mechanisms of altered gas exchange in disease, how the body compensates for abnormal gas exchange, and based on these principles, the tools available to interpret blood gas data and, quantitatively, to best understand the physiological state of each patient. This understanding is important because therapeutic intervention to improve abnormal gas exchange in any given patient needs to be based on the particular physiological mechanisms affecting gas exchange in that patient.