Long-term use of supplemental oxygen improves survival in patients with COPD and severe resting hypoxemia. However, the role of oxygen in symptomatic patients with COPD and more moderate hypoxemia at rest and desaturation with activity is unclear. The few long-term reports of supplemental oxygen in this group have been of small size and insufficient to demonstrate a survival benefit. Short-term trials have suggested beneficial effects other than survival in patients with COPD and moderate hypoxemia at rest. In addition, supplemental oxygen appeared to improve exercise performance in small short-term investigations of patients with COPD and moderate hypoxemia at rest and desaturation with exercise, but long-term trials evaluating patient-reported outcomes are lacking. This article reviews the evidence for long-term use of supplemental oxygen therapy and provides a rationale for the National Heart, Lung, and Blood Institute Long-term Oxygen Treatment Trial. The trial plans to enroll subjects with COPD with moderate hypoxemia at rest or desaturation with exercise and compare tailored oxygen therapy to no oxygen therapy.