The goal of this study was to identify airway and alveolar site(s) of inflammation using exhaled nitric oxide (NO) as a marker in treated patients with asthma, including response to oral corticosteroids, and correlate these sites with expiratory airflow limitation. In 53 (24 male) patients with asthma, age 43 ± 23 years (mean ± SD) and all on inhaled corticosteroids, post 180 μg aerosolized albuterol, FEV1 was 74 ± 23% predicted and FEV1/FVC was 68 ± 11%. Exhaled NO at 100 ml/second was 27 ± 23 ppb (p < 0.001 compared with normal, 12 ± 15 ppb). Bronchial NO maximal flux was 2.4 ± 3.1 nl/second (p < 0.001 compared with normal, 0.85 ± 0.55). Alveolar NO concentration was 7.0 ± 7.4 ppb (p = 0.01 compared with the normal value, 3.2 ± 2.0 ppb). There was no significant correlation between FEV1 % predicted or lung elastic recoil and NO bronchial flux or alveolar concentration. However, there was a weak but significant correlation between NO bronchial flux and alveolar concentration (Spearman r = 0.50, p < 0.001). In 10 subjects with asthma on inhaled corticosteroids, 5 days of 30 mg prednisone resulted in isolated significant decreases in NO alveolar concentration, from 13 ± 10 to 4 ± 4 ppb (p = 0.002). Despite treatment, including inhaled corticosteroids, patients with asthma may have ongoing separate airway and alveolar sites of NO inflammation, the latter responsive to oral corticosteroids.