Besides the physical hazards of increased chances of fire and burns during storage, transport and use of oxygen, the high concentrations of oxygen are associated with several physiological and toxic effects. Oxygen promotes CO2 retention by suppression of hypoxic ventilatory drive when administered in higher concentration for an acute exacerbation of COPD. It may also result in absorption atelectasis by replacing nitrogen in the poorly ventilated areas in the presence of pre-existing V/Q mismatch when given at a FiO2 of 0.9 to 1.0. Breathing at 80% or more of oxygen for acute hypoxic conditions may also cause a mild increase in peripheral vascular resistance and a slight decrease in cardiac output. Tissue oxygen toxicity can result from high concentration due to toxic oxygen metabolites. Oxidant injury may manifest as tracheobronchitis, acute lung injury (acute respiratory distress syndrome) or bronchopulmonary dysplasia (chronic lung injury). Hyperbaric hyperoxia can cause neurological toxicity varying from transient paresthesias to convulsions. Retrolental fibroplasias may occur in premature infants with respiratory distress syndrome. Oxygen toxicity is best prevented than treated. Besides lowering the concentration of administered oxygen, the treatment includes the augmentation of antioxidant defences, blocking of free radical production and modulation of inflammatory responses.