This is a test of the ability of inhaled carbon monoxide to diffuse into the pulmonary circulation.

It is dependent on functional alveolar capillary membrane surface area and red blood cells within the circulation.

It is reduced when ever there is a loss of functional alveolar capillary membrane surface area or decrease in hemoglobin.

The diffusion capacity is "corrected" for lung volume by dividing by VA (alveolar volume). This gives a an estimate of the diffusion capacity of the lung volume that is present.