Vision loss due to various forms of outer retinal degeneration remains a major problem in clinical ophthalmology. Most retinal degenerations are precipitated by genetic mutations affecting the retinal pigment epithelium and sensory retina, but it is becoming increasingly evident that resultant metabolic changes within the retina may also contribute to the further progression of photoreceptor cell loss. In particular, a role for the local oxygen environment within the retina has been proposed. The correct balance between retinal oxygen supply and oxygen consumption in the retina is essential for retinal homeostasis, and disruption of this balance is a factor in many retinal diseases. In animal models of photoreceptor degeneration, manipulation of environmental oxygen levels has been reported to be able to modulate the rate of photoreceptor degeneration. Clinically, hyperbaric oxygen therapy has already been used in retinitis pigmentosa patients and other types of oxygen therapy have been proposed. It therefore seems appropriate to review our current understanding of the oxygen environment in the normal and degenerating retina, and to build a clearer picture of how the retinal oxygen environment can be modulated. We focus on techniques that have been, or may be, applied clinically, such as modulation of systemic oxygen levels and modulation of retinal oxygen metabolism by light deprivation. Data from direct measurements of intraretinal oxygen distribution in rat models at different stages of photoreceptor degeneration will be reviewed. These models include the Royal College of Surgeons (RCS) rat, and the P23H rat model of outer retinal degeneration. Microelectrode based techniques have allowed the intraretinal oxygen distribution to be measured as a function of retinal depth under well-controlled systemic conditions at different stages of the degeneration process. Both models showed changes in the intraretinal oxygen distribution during the degenerative period, with the changes reflecting the gradual loss of oxygen metabolism of the degenerating photoreceptors. This results in higher than normal oxygen levels in the remaining outer retina and a significant alteration in the oxygen flux from the choroid to the inner retina. The maintenance of normal oxygen levels in the inner retina implies that inner retinal oxygen uptake is well preserved, and that there is also reduced oxygen input from the deeper capillary layer of the retinal circulation. Choroidal oxygen tension and the oxygen tension in the pre-retinal vitreous were unaffected at any of the time periods studied prior to, and during, the degeneration process. It is well known that both hypoxia and hyperoxia can cause neural cell stress and damage. Logically, any therapeutic intervention based on oxygen therapy should attempt to restore the oxygen environment of the remaining retinal cells to within the physiological range. Before any oxygen based therapies for the treatment of retinal degeneration should be seriously considered, the oxygen environment in the degenerating retina should be determined, along with clinically usable methods to restore the oxygen environment to the critical cell layers.