The premature infant is to some extent protected from hypoxia, however defense against hyperoxia is poorly developed. The optimal assessment of oxygenation is to measure oxygen delivery and extraction. At the bedside PaO2 and SpO2 are approximations of oxygenation at the tissue level. After birth asphyxia it is crucial to know whether or not to give oxygen supplementation, when, how much, and for how long. Oxygen saturation targets in the delivery room have been studied, but the optimal targets might still be unknown because factors like gender and delayed cord clamping influence saturation levels. However, SpO2 > 80% at 5 min of age is associated with favorable long term outcome in preterm babies. Immature infants most often need oxygen supplementation beyond the delivery room. Predefined saturation levels, and narrow alarm limits together with the total oxygen exposure may impact on development of oxygen related diseases like ROP and BPD. Hyperoxia is a strong trigger for genetic and epigenetic changes, contributing to the development of these conditions and perhaps lifelong changes.