The effect of oxygen breathing on shunt and ventilation-perfusion ratios (VA/Q) in anesthetized rats was studied using a modification of the multiple inert gas elimination technique. Base-line analyses showed hypoxemia in some animals breathing room air (arterial O2 tensions 48-70 Torr) associated with intrapulmonary shunts ranging from 0 to 22%, and variable low VA/Q lung regions as determined by calculation of the inert gas arterial-alveolar difference curve. Of nine rats that breathed 100% oxygen for 30 min, three showed increases in shunt (0% leads to 19%, 1.5% leads to 16%, 11% leads to 40%). These three animals had larger preexisting low VA/Q regions than the six that developed no shunt (0.48 +/- 0.15 vs. 0.17 +/- 0.03 (mean +/- SD); P less than 0.05). These data are compatible with the theory of absorption atelectasis. This study documents the usefulness of the inert gas elimination technique for studying pulmonary gas exchange problems in small animals.