The ability of oxyhemoglobin to inhibit nitric oxide (NO)-dependent activation of soluble guanylate cyclase and vasodilation provided some of the earliest experimental evidence that NO was the endothelium-derived relaxing factor (EDRF). The chemical behavior of this dioxygenation reaction, producing nearly diffusion limited and irreversible NO scavenging, presents a major paradox in vascular biology: The proximity of large amounts of oxyhemoglobin (10 mmol/L) to the endothelium should severely limit paracrine NO diffusion from endothelium to smooth muscle. However, several physical factors are now known to mitigate NO scavenging by red blood cell encapsulated hemoglobin. These include diffusional boundaries around the erythrocyte and a red blood cell free zone along the endothelium in laminar flowing blood, which reduce reaction rates between NO and red cell hemoglobin by 100- to 600-fold. Beyond these mechanisms that reduce NO scavenging by hemoglobin within the red cell, 2 additional mechanisms have been proposed suggesting that NO can be stored in the red blood cell either as nitrite or as an S-nitrosothiol (S-nitroso-hemoglobin). The latter controversial hypothesis contends that NO is stabilized, transported, and delivered by intra-molecular NO group transfers between the heme iron and β-93 cysteine to form S-nitroso-hemoglobin (SNO-Hb), followed by hypoxia-dependent delivery of the S-nitrosothiol in a process that links regional oxygen deficits with S-nitrosothiol–mediated vasodilation. Although this model has generated a field of research examining the potential endocrine properties of intravascular NO molecules, including S-nitrosothiols, nitrite, and nitrated lipids, a number of mechanistic elements of the theory have been challenged. Recent data from several groups suggest that the nitrite anion (NO₂⁻) may represent the major intravascular NO storage molecule whose transduction to NO is made possible through an allosterically controlled nitrite reductase reaction with the heme moiety of hemoglobin. As subsequently understood, the hypoxic generation of NO from nitrite is likely to prove important in many aspects of physiology, pathophysiology, and therapeutics.