Pulse oximetry has become the standard of care in operating rooms, intensive care units, and hospitals worldwide. A pulse oximeter continuously and noninvasively monitors the functional oxygen saturation of hemoglobin in arterial blood (Sa[subscript O2]). Sa[subscript O2] is so important in medical care that it is often regarded as a fifth vital sign. Before pulse oximetry, arterial puncture for blood gas analysis was the only method available to determine Sa[subscript O2] and to identify the presence of hypoxemia. Pulse oximetry is based on the principle that oxygenated hemoglobin (O2Hb) absorbs more near-infrared light than deoxyhemoglobin (HHb) and HHb absorbs more red light than O[subscript 2]Hb. It is important to understand the principles of pulse oximetry, how the equipment works, and its limitations to interpret the information it provides. Accordingly, we used colored balloons to introduce the physics of how a pulse oximeter detects and measures oxyhemoglobin and deoxyhemoglobin in pulsatile (arterial) and nonpulsatile (venous and capillary) blood. The foundations of oximetry started in the 1700s with Johann Lambert (1728-1777). We approached this complex physics in a straightforward way while still providing an understanding of the fundamental concepts developed by Johann Lambert in 1760.