The effects of hydration on the solvation, diffusivity, solubility, and permeability of oxygen molecules in sustainable, biodegradable chitosan/chitin food packaging films were studied via molecular dynamics and confined random walk simulations. With increasing hydration, the membrane has a more homogeneous water distribution with the polymer chains being fully solvated. The diffusivity increased by a factor of 4 for oxygen molecules and by an order of magnitude for water with increasing the humidity. To calculate the Henry's constant and solubility of oxygen in the membranes with changing hydration, the excess chemical potential was calculated via free energy perturbation, thermodynamic integration and direct particle deletion methods. The simulations predicted a higher solubility and permeability for the lower humidity, in contradiction to experimental results. All three methods for calculating the solubility were in good agreement. It was found that the Coulombic interactions in the potential caused the oxygen to bind too strongly to the protonated amine group. Insight from this work will help guide molecular modeling of chitosan/chitin membranes, specifically permeability measurements for small solute molecules. Efforts to chemically tailor chitosan/chitin membranes to favor discrete as opposed to continuous aqueous domains could reduce oxygen permeability.