Although pulse oximeters have been used extensively over the last few years in clinical monitoring applications, the theoretical basis of pulse oximetry is still poorly understood. As a result, the development of instrumentation has relied on the slow acquisition of empirical knowledge. Recently, clinicians have expressed interest in the possibility of developing a transcutaneous oximeter that operates in the reflection mode, rather than in the transmission mode. Such a device could be used at many sites on the body, and may enable monitoring during shock and other conditions during which peripheral blood flow is compromised. Using a photon-diffusion model, we have studied the effect of tissue blood volume and other important variables on the calibration of reflectance-mode oximeters employing a variety of sensor configurations. Measurements from gelatin/milk tissue phantoms and skin compare favorably with model predictions. We are now constructing prototype solid-state sensors which will - be used to measure skin reflectance. New methods for determining blood oxygen saturation from remitted intensities will be tested in hypoxic animal models.