Few data are available concerning pulmonary function in patients with severe chronic congestive heart failure. Of 315 patients evaluated for potential cardiac transplantation at UCLA, 132 underwent pulmonary function tests. The latter patients had severe heart failure with a mean left ventricular ejection fraction of 19 percent and mean cardiac index of 2.1 L/min/m2. Diffusion impairment either alone or combined with restrictive and/or obstructive ventilatory defects occurred in 67 percent of the patients evaluated. Diffusion impairment occurred as the sole abnormality in 31 percent of the patients and in combination with a restrictive ventilatory defect in 21 percent. A reduction in diffusing capacity has not been previously described as a frequent finding in patients with chronic congestive heart failure. In contrast to other studies involving patients with acute heart failure, obstructive ventilatory defects were uncommon. None of the lung function abnormalities was associated with smoking status, prior drug use, chest roentgenographic changes, hemodynamic findings, or clinical features, including duration of congestive heart failure. The mechanism for the diffusion impairment is unclear but could be due to chronic passive congestion with pulmonary fibrosis and/or recurrent pulmonary emboli. Recognition of diffusion impairment as a common finding in patients with severe chronic congestive heart failure who are candidates for heart transplantation is important for proper interpretation of possible post-transplant changes in diffusing capacity due to other causes.