In neonates with persistent pulmonary hypertension, nitric oxide improves oxygenation. Nitric oxide relaxes vascular smooth muscle by binding to heme moiety of cytosolic guanylate cyclase, activating guanylate cyclase and increasing intracellular levels of cyclic guanosine 3′,5′-monophosphate, which leads to vasodilation. When inhaled, pulmonary vasodilation occurs and an increase in partial pressure of arterial oxygen results. Dilation of pulmonary vessels in well-ventilated lung areas redistributes blood flow away from lung areas where ventilation/perfusion ratios are poor.