Inspired air flows down the airways to reach the alveoli. Along this way, the temperature of this relatively small volume of air equilibrates with body temperature and becomes saturated with water vapour. In the alveolar space, the inspired air mixes with a relatively large volume of alveolar gas that contains less oxygen and by far more carbon dioxide. Since a relatively small volume is relatively frequently exchanged between one and the other compartment, the composition of alveolar gas changes only slightly. Therefore breathing in principle supports two net fluxes, a practically constant flux of oxygen from the alveoli to the venous blood and of carbon dioxide to alveoli. In this first part of our review of lung physiology, we first define lung volumes, capacities and flows. We further deal with mechanics of breathing and analyse temporal characteristics of pressures, volumes and flows in the respiratory system, and show how they depend on static and dynamic resistances. A novel and clear graphic presentation of work of breathing is given at the end of the chapter on mechanics. We continue with a detailed analysis of factors that determine the composition of the inhaled and alveolar gas mixture and conclude by pointing out the role of diffusional exchange of oxygen and carbon dioxide across the alveolocapillary membrane in equilibrating partial pressures of both gases between the fluid phase in the blood and the gaseous phase in the alveoli.