Fluctuations in oxygen (O2) levels characterise the cellular microenvironment in physiological and pathological processes such as placentation and malignant progression. Cells adapt to such changes in oxygenation by modifying gene expression, thereby regulating a spectrum of functions. Recent studies indicate that an important mechanism by which cells adapt to changes in oxygenation involves modifications in endogenous nitric oxide (NO) signalling. The effect of oxygen on the NO pathway involving cyclic guanosine monophosphate (cGMP)-dependent signalling appears to play a critical role in the regulation of cellular phenotypes. This specific NO signalling pathway may also operate in conjunction with gene expression regulated by the transcription molecule hypoxia inducible factor 1 (HIF-1). Thus, NO is emerging as a novel regulator of oxygen-sensitive phenotypes.