There are limited methods of assessing pulmonary function in horses at rest. In this study, we developed clinical techniques to measure gas exchange efficiency in horses. These techniques were then used to evaluate horses with varying degrees of lower respiratory disease. Three groups of horses (Group 1: asymptomatic, n=6; Group 2: symptomatic only with rebreathing, n=11; Group 3: symptomatic at rest, n=9) were selected based on physical exam, transtracheal aspirate, and thoracic radiographs. Blood samples were obtained from the transverse facial artery and jugular vein. Maximal end-tidal CO₂ tension (E_TCO₂) was measured by an infrared capnograph through a facemask. Alveolar O, tension, alveolar dead space fraction (V_DB/V_T), and physiologic shunt fraction (Q_S/Q_T) were calculated using standard formulas. Horses with both mild and severe signs of lower respiratory disease had significant (p<0.05) differences in gas exchange indices at rest compared to asymptomatic horses. Albuterol was administered to seven of the Group 2 horses from a metered-dose inhaler through an equine facemask at a dose of 90 μg per 100 kg. Blood samples and tidal gas samples were obtained 15 minutes post-treatment, and Q_S/Q_T and (V_DB/V_T) were calculated. Albuterol caused significant (p<0.05) hypoxemia 15 minutes following inhaled administration. This was accompanied by a significant increase in Q_S/Q_T, suggesting that the hypoxemia was due to increases in which the ratios of ventilation to perfusion were decreased. / Master of Science