Objective: To test the hypothesis that environmental compared with nasal cannula oxygen decreases episodes of intermittent hypoxemia (oxygen saturations <85% for ≥10 seconds) in preterm infants on supplemental oxygen by providing a more stable hypopharyngeal oxygen concentration. Study design: This was a single center randomized crossover trial with a 1:1 parallel allocation to order of testing. Preterm infants on supplemental oxygen via oxygen environment maintained by a servo-controlled system or nasal cannula with flow rates ≤1.0 L per kg per minute were crossed over every 24 hours for 96 hours. Data were collected electronically to capture real time numeric and waveform data from patient monitors. Results: Twenty-five infants with gestational age of 27 ± 2 weeks (mean ± SD) and a birth weight of 933 ± 328 g were studied at postnatal day 36 ± 26. The number of episodes of intermittent hypoxemia per 24 hours was 117 ± 77 (median, 98; range, 4-335) with oxygen environment vs 130 ± 63 (median, 136; range, 16-252) with nasal cannula (P =.002). Infants on oxygen environment compared with nasal cannula also had decreased episodes of severe intermittent hypoxemia (P =.005). Infants on oxygen environment compared with nasal cannula had a lower proportion of time with oxygen saturations <85% (.05 ±.03 vs.06 ±.03, P <.001), and a lower coefficient of variation of oxygen saturation (P =.02). Conclusions: In preterm infants receiving supplemental oxygen, servo-controlled oxygen environment decreases hypoxemia compared with nasal cannula. Trial registration: ClinicalTrials.gov: NCT02794662.