A single-center report describes the results of an effort to maintain oxygen saturation levels within a prespecified target range for VLBW infants, with monitoring of compliance using signal-extraction technology pulse oximetry. The target range for VLBW infants on supplemental oxygen was 85 to 93% and for those in room air, 85 to 100%. Pulse oximetry alarm limits were set 1% higher and lower than the target range values. Written guidelines were developed to educate staff on how to respond to low and high saturation alarms. Extensive staff education was conducted. Following this effort, there was a decrease in severe retinopathy of prematurity (adjusted odds ratio 0.41) and in ROP requiring surgery (adjusted odds ratio 0.31). No effect was noted on bronchopulmonary dysplasia.