Sleep apnea is a common sleep disorder that can significantly decrease the quality of life. An accurate and early diagnosis of sleep apnea is required before getting proper treatment. A reliable automated detection of sleep apnea can overcome the problems of manual diagnosis (scoring) due to variability in recording and scoring criteria (for example across Europe) and to inter-scorer variability. This study explored a novel automated algorithm to detect apnea and hypopnea events from airflow and pulse oximetry signals, extracted from 30 polysomnography records of the Sleep Heart Health Study. Apneas and hypopneas were manually scored by a trained sleep physiologist according to the updated 2017 American Academy of Sleep Medicine respiratory scoring rules. From pre-processed airflow, the peak signal excursion was precisely determined from the peak-to-trough amplitude using a sliding window, with a per-sample digitized algorithm for detecting apnea and hypopnea. For apnea, the peak signal excursion drop was operationalized at ≥85% and for hypopnea at ≥35% of its pre-event baseline. Using backward shifting of oximetry, hypopneas were filtered with ≥3% oxygen desaturation from its baseline. The performance of the automated algorithm was evaluated by comparing the detection with manual scoring (a standard practice). The sensitivity and positive predictive value of detecting apneas and hypopneas were respectively 98.1% and 95.3%. This automated algorithm is applicable to any portable sleep monitoring device for the accurate detection of sleep apnea.