The distribution of blood cells in the vascular system is not homogeneous, red cell concentration in the small vessel compartment being significantly lower than in the large vessel compartment. This is to some extent due to the difference in travelling speed between cells and plasma in the microcirculation (Fahraeus effect). However, even in the terminal vessel network haematocrit varies considerably as a result of plasma skimming phenomena. Thus, local (capillary) haematocrit is a function of flow rate distribution at bifurcations. Red cell concentration in the majority of capillaries is substantially lower than in any other vessel category, while a small number of capillaries carry an increased haematocrit, thereby satisfying mass balance. The haematocrit distribution as well as the average level of capillary haematocrit is a function of small vessel volume which in turn depends on pre-capillary resistance: vasodilation leads to increased capillary haematocrit and vice versa. Thus, one of the physiological functions of the resistance vessels is to determine the level of microvascular haematocrit. Alteration of red cell microrheology leads to a reduction of capillary O2-transport capacity mainly by reducing the haematocrit in nutritive capillaries.