Blood lactate concentration predicts mortality in critically ill patients and is clinically used in the diagnosis, grading of severity, and monitoring response to therapy of septic shock. This paper summarizes available quantitative data to provide the first comprehensive description and critique of the accepted concepts of the physiology of lactate in health and shock, with particular emphasis on the controversy of whether lactate release is simply a manifestation of tissue hypoxia versus a purposeful transfer ("shuttle") of lactate between tissues. Basic issues discussed include (1) effect of nonproductive lactate-pyruvate exchange that artifactually enhances flux measurements obtained with labeled lactate, (2) heterogeneous tissue oxygen partial pressure (Krogh model) and potential for unrecognized hypoxia that exists in all tissues, and (3) pathophysiology that distinguishes septic from other forms of shock. Our analysis suggests that due to exchange artifacts, the turnover rate of lactate and the lactate clearance are only about 60% of the values of 1.05 mmol/min/70 kg and 1.5 L/min/70 kg, respectively, determined from the standard tracer kinetics. Lactate turnover reflects lactate release primarily from muscle, gut, adipose, and erythrocytes and uptake by the liver and kidney, primarily for the purpose of energy production (TCA cycle) while the remainder is used for gluconeogenesis (Cori cycle). The well-studied physiology of exercise-induced hyperlactatemia demonstrates massive release from the contracting muscle accompanied by an increased lactate clearance that may occur in recovering nonexercising muscle as well as the liver. The very limited data on lactate kinetics in shock patients suggests that hyperlactatemia reflects both decreased clearance and increased production, possibly primarily in the gut. Our analysis of available data in health and shock suggests that the conventional concept of tissue hypoxia can account for most blood lactate findings and there is no need to implicate a purposeful production of lactate for export to other organs.