A proved case of patent ductus arteriosus occurring distal to the origin of the left subclavian artery with persistent reversal of flow through the shunt and compensatory polycythemia has been reported. Studies of cellular morphology and oxygen saturation of the bone marrow in the sternum and ilium were performed. The results indicated that the sternal marrow manifested the same marked degree of normoblastic hyperplasia as the iliac marrow, although the oxygen saturation of the iliac marrow was markedly decreased as compared to the normal saturation of the sternal marrow. This demonstrates that anoxia of the bone marrow could not have been the stimulus to the increased erythropoietic activity found in the sternal marrow. The study appears to support the belief that anoxemia of the blood stimulates the production or release of a humoral factor which in turn produces increased erythropoiesis.