Recent work has defined novel oxygen sensitive pathways that signal hypoxia by modulating post-translational amino acid hydroxylation at specific sites. Hypoxia inducible factor (HIF) is an alpha/beta heterodimeric transcriptional complex that plays a key role in directing cellular responses to hypoxia. The activity of HIF is itself controlled by post-translational hydroxylation at prolyl and asparaginyl residues within the alpha-sub-units. HIF prolyl hydroxylation governs proteolytic regulation of HIF whereas HIF asparaginyl hydroxylation (FIH) modulates interaction with transcriptional co-activators. These hydroxylations are catalysed by a set of non-haem Fe(II) 2-oxoglutarate (2OG) dependent dioxygenases. During catalysis, the splitting of molecular oxygen is coupled to the hydroxylation of HIF and the oxidative decarboxylation of 2-oxoglutarate to give succinate and CO2. Hydroxylation at two prolyl residues within the central ‘degradation domain’ of HIF-alpha increases the affinity for the von Hippel-Lindau (pVHL) E3 ligase complex by at least three orders of magnitude, thus directing HIF-alpha polypeptides for proteolytic destruction by the ubiquitin/proteasome pathway. Since the HIF hydroxylases have an absolute requirement for molecular oxygen this process is suppressed in hypoxia allowing the HIF-alpha to escape destruction and activate transcription. Co-substrate and co-factor requirements for Fe(II), ascorbate, and the Kreb’s cycle intermediate (2OG) and inducible changes in the cellular abundance of three closely related HIF prolyl hydroxylases (PHD1-3) provide additional interfaces with cellular oxygen status that may be important in regulating the oxygen sensitive signal. Further work has defined other sites of FIH dependent asparaginyl hydroxylation, notably at specific residues within ankyrin repeat domains, indicating that intracellular protein hydroxylation is more common has been so far appreciated. The implications for understanding physiological oxygen homeostasis will be discussed.