The aim of this study was to determine whether the decreased muscle and blood lactate during exercise with hyperoxia (60% inspired O2) vs. room air is due to decreased muscle glycogenolysis, leading to decreased pyruvate and lactate production and efflux. We measured pyruvate oxidation via PDH, muscle pyruvate and lactate accumulation, and lactate and pyruvate efflux to estimate total pyruvate and lactate production during exercise. We hypothesized that 60% O2 would decrease muscle glycogenolysis, resulting in decreased pyruvate and lactate contents, leading to decreased muscle pyruvate and lactate release with no change in PDH activity. Seven active male subjects cycled for 40 min at 70% V̇o2 peak on two occasions when breathing 21 or 60% O2. Arterial and femoral venous blood samples and blood flow measurements were obtained throughout exercise, and muscle biopsies were taken at rest and after 10, 20, and 40 min of exercise. Hyperoxia had no effect on leg O2 delivery, O2 uptake, or RQ during exercise. Muscle glycogenolysis was reduced by 16% with hyperoxia (267 ± 19 vs. 317 ± 21 mmol/kg dry wt), translating into a significant, 15% reduction in total pyruvate production over the 40-min exercise period. Decreased pyruvate production during hyperoxia had no effect on PDH activity (pyruvate oxidation) but significantly decreased lactate accumulation (60%: 22.6 ± 6.4 vs. 21%: 31.3 ± 8.7 mmol/kg dry wt), lactate efflux, and total lactate production over 40 min of cycling. Decreased glycogenolysis in hyperoxia was related to an ∼44% lower epinephrine concentration and an attenuated accumulation of potent phosphorylase activators ADPf and AMPf during exercise. Greater phosphorylation potential during hyperoxia was related to a significantly diminished rate of PCr utilization. The tighter metabolic match between pyruvate production and oxidation resulted in a decrease in total lactate production and efflux over 40 min of exercise during hyperoxia.