Exposure to domestic levels of formaldehyde has been associated with adverse respiratory symptoms in both adults and children. The underlying mechanisms responsible for these findings have not been established. In order to investigate possible inflammatory effects of formaldehyde at levels typically found in the home, we measured exhaled nitric oxide (eNO) in 224 healthy children 6 to 13 yr of age (116 girls) and monitored formaldehyde levels in their homes. Formaldehyde was monitored using a passive sampling technique. Exhaled NO was measured directly into a fast response chemiluminescence nitric oxide analyzer. The children also undertook a lung function (spirometry) test. There was no effect of formaldehyde levels measured in homes on spirometric variables. However, eNO levels were significantly elevated in children living in homes with average formaldehyde levels >/= 50 ppb. Exhaled NO levels (geometric mean) were 15.5 ppb (95% CI: 10.5 to 22.9 ppb) for children from homes with formaldehyde concentrations >/= 50 ppb compared with 8.7 ppb (7.9 to 9.6) for children from homes with formaldehyde concentrations < 50 ppb (p < 0.05). These results suggest that exposure to formaldehyde in homes may invoke a subclinical inflammatory response in the airways of healthy children.