Oxygen-carbon dioxide-The process by which oxygen passes from the air in the LUNGS to the HEMOGLOBIN in the BLOOD, and carbon dioxide from the hemoglobin passes into the air in the lungs.Oxygen-carbon dioxide exchange is fundamental to life and is the primary function of the lungs.Oxygen-carbon dioxide exchange takes place between the alveoli, the tiny bubblelike sacs deep within the lungs, and the capillaries, the tiniest blood vessels of the cardiovascular system.xygen and carbon dioxide molecules (as well as the molecules of other gases such as nitrogen and highly toxic carbon monoxide) can easily pass through the walls of the alveoli and the capillaries, moving in the direction of least resistance. Oxygen molecules move from the alveoli into the capillaries with inhalation.