The functional residual capacity was given the least importance than the other lung volume parameters. Studies have revealed the restrictive pattern of lung disease in patients with liver cirrhosis. We aimed to analyze the importance of the functional residual capacity and other lung volumes of cirrhotic patients.Forty (40) patients with cirrhosis (Child's-B) were enrolled in this study. The vital capacity was measured by an instrument called V02 Max 22. The other lung volumes which were measured were derived parameters. The functional residual capacity was measured by the nitrogen wash-out method.The measured value of the functional residual capacity was below normal as compared to the reference value. The total lung capacity and the vital capacity were positively correlated with the functional residual capacity. The residual volume was found to be increased in twelve out of forty cirrhotic patients.The functional residual capacity can be determined by the compliance of the lung and the chest wall. The patients with a reduced functional residual capacity may be suffering from dyspnoea, probably due to the restrictive pattern of the lung disease. Hence, the reduced lung volumes of the subjects may be due to the abnormalities in the mechanics of ventilation.