The effect of supplemental oxygen breathing on bicycle exercise performance was studied in 16 patients in the assessment of their extent of impairment with interstitial lung disease (ILD). The mean maximal working capacity (W-Max) +/- 1 SD with incremental exercise breathing air was 107 +/- 43 W (60% predicted). There was no significant increase in W-Max with oxygen breathing (p less than 0.10, n = 12). On a separate day each patient performed 2 endurance studies at a constant submaximal work load (80% W-Max) inspiring air and 60% oxygen. The mean fall in arterial oxyhemoglobin saturation (SaO2%) during exercise in air was 8% (range, 1 to 23%). There was a significant improvement in exercise time (p less than 0.001) when patients exercised with oxygen. This increase in endurance was significantly correlated with the fall in SaO2% during the air study. The improvement in exercise time with oxygen was greatest in those with the most marked lung restriction. Blood lactic acid was reduced with oxygen breathing.