The pulmonary circulation constricts in response to acute hypoxia, which is reversible on reexposure to oxygen. On exposure to chronic hypoxia, in addition to vasoconstriction, the pulmonary vasculature undergoes remodeling, resulting in a sustained increase in pulmonary vascular resistance that is not immediately reversible. Hypoxic pulmonary vasoconstriction is physiological in the fetus, and there are many mechanisms by which the pulmonary vasculature relaxes at birth, principal among which is the acute increase in oxygen. Oxygen-induced signaling mechanisms, which result in pulmonary vascular relaxation at birth, and the mechanisms by which chronic hypoxia results in pulmonary vascular remodeling in the fetus and adult, are being investigated. Here, the roles of cGMP-dependent protein kinase in oxygen-mediated signaling in fetal pulmonary vascular smooth muscle and the effects of chronic hypoxia on ion channel activity and smooth muscle function such as contraction, growth, and gene expression were discussed.