After completing this article, readers should be able to: 1. Describe the physiology of production and clearance of lung liquid. 2. Compare and contrast the initial breath in spontaneously breathing and asphyxiated newborns. 3. Delineate the major respiratory reflexes involved in resuscitation. 4. List changes in pulmonary circulation at birth. 5. List possible deleterious effects of hyperoxia. The most important part of the transition from intrauterine to extrauterine life is the establishment of effective pulmonary gas exchange. Currently used techniques of resuscitation, although usually successful, are based on few physiologic studies and have come under critical review recently. This article reviews current understanding of pulmonary physiology during transition and resuscitation, based primarily on experimental animal studies, and relates it to clinical practices in neonatal resuscitation. The switch from placental to pulmonary gas exchange at birth requires rapid removal of lung liquid from the potential air space (Fig. 1⇓ ) [multimedia-1] . This process is much more complex than simple mechanical compression of the chest at delivery that results in oral drainage of lung liquid, and it is controlled primarily by ion transport across the airway and pulmonary epithelium. Figure 1. Fluid replaced by air in alveoli with the first breaths after birth. Reprinted with permission from Textbook of Neonatal Resuscitation . During fetal life, the lungs are filled with liquid, and normal growth of the lungs depends in part on the balance between production and drainage of this fluid. The pulmonary epithelium actively transports chloride into the lung lumen, generating an osmotic gradient that causes liquid to flow from the microcirculation through the interstitium into potential air spaces. In fetal lambs, the hourly production of lung liquid increases from 2 mL/kg at midgestation to 5 mL/kg at term, and the total volume increases from 4 to 6 mL/kg at midgestation to more than 20 mL/kg near …