Oxygen therapy through a transtracheal catheter has been used increasingly for the long-term delivery of continuous oxygen. Compared to nasal cannula it results in significant reduction in oxygen flow requirements. This form of therapy has gained patient acceptance because of several advantages including improved convenience, aesthetics, compliance, and mobility. Reported complications generally have been minor, including subcutaneous emphysema, cough, "mucous ball" formation and mild hemoptysis. In this report, we describe a case of granulation tissue formation at the transtracheal catheter puncture site which was treated with Nd:YAG laser bronchoscopy to reestablish patency of the upper airway. No recurrence was noted after two years of follow-up.