During inhalation, oxygen comes into alveoli of the lungs. The alveoli are surrounded by very thin blood vessels called capillaries. So, the oxygen diffuses out from the alveoli walls to the blood in capillaries. The oxygen is carried by the blood to all the parts of the body by binding it with haemoglobin present in the blood.
The blood passes through the tissues of the body and the oxygen present in it diffuses into the cells (due to its higher concentration in the blood). This oxygen combines with the digested food present in the cells to release energy. Carbon dioxide is produced as a waste product during respiration in the cells of the body tissues. This CO2 diffuses into the blood (due to its higher concentration in body tissues). Blood carries the back to the lungs where it diffuses into the alveoli of the lungs into the trachea, nostrils and then out of the body into air. CO2 is more soluble in water than oxygen and hence mostly transported in the dissolved form in our blood.
