Exhaled breath analysis may be used to quantify inflammation and oxidative stress in the respiratory tract, in the differential diagnosis of airway diseases, and in the monitoring of therapy. The greatest progress has been made with standardized measurement of exhaled nitric oxide (NO). Bronchial NO is increased in asthma, correlated with other markers of inflammation, and reduced by treatment with corticosteroids and antileukotrienes. Alveolar NO is increased in chronic obstructive pulmonary disease (COPD), reflecting disease severity and progression. Exhaled carbon monoxide and ethane are increased in both asthma and COPD. Increased concentrations of 8-isoprostane, hydrogen peroxide, nitrite, and nitrotyrosine are found in exhaled breath condensate from patients with inflammatory lung diseases. Increased levels of lipid mediators are also found, and the pattern depends on the nature of the disease process. Additional biomarkers are exhaled breath temperature, which is elevated in asthma and reduced in COPD, and bronchial blood flow. It is likely that smaller and more sensitive analyzers will extend the discriminatory value of exhaled breath analysis and that new techniques will become available to diagnose and monitor respiratory diseases in the family practice and home settings.