The effect of left lung atelectasis on the regional distribution of blood flow (Q), ventilation (V(A)) and gas exchange on the right lung ventilated with 100% O2 was studied in anesthetized dogs in the lateral decubitus posture. Q and V(A) were measured in 1.7 ml lung volume pieces using injected and aerosolized fluorescent microspheres, respectively. Hypoxic pulmonary vasoconstriction (HPV) in the atelectatic lung shifted flow to the ventilated lung. The increased flow in the ventilated lung ensured adequate gas exchange, compensating for the hypoxemia due to shunt contributed by the atelectatic lung. Left lung atelectasis caused a compensatory increase in the ventilated lung FRC that was smaller in the right (RLD) than left (LLD) lateral posture, the effect of lung compression by the atelectatic lung and mediastinal contents in the RLD posture. The O2 deficit measured by (A-a)DO2 increased with left lung atelectasis and was exacerbated in the LLD posture by 10 cm H2O PEEP, a result of increased shunt caused by a shift in Q from the ventilated to the atelectatic lung. The PEEP-induced O2 deficit was eliminated with inversion to the RLD posture.