Technical Abstract: Eight channel catfish Ictalurus punctatus spawns were split into two approximately equal portions and incubated in separate 185-L square fiberglass tanks. Eight of the tanks were aerated with air supplied by a blower; the other eight tanks were aerated with liquid oxygen (LOX). Dissolved oxygen (DO) averaged 7.4±0.02 (94.3% saturation) and 18.4±0.28 mg/L (232.8%) through hatching in the low and high oxygen treatments, respectively. Eggs hatched six hours earlier in the low oxygen incubation but reached swim-up stage 31 h later (P<0.001). Survival to swim-up stage in the low oxygen treatment was reduced by 18.5% (P<0.10) and fry dry weight was reduced by 5.7% (P<0.05). Oxygen consumption was determined throughout the study using respirometry. Oxygen consumption increased through swim-up stage as expected. However, the incipient limiting level (the oxygen concentration at which metabolism became oxygen-limited) peaked during the last day of incubation at 96% saturation, and decreased to less than 50% saturation after hatching. It is postulated that premature hatching observed in this study was precipitated in the last day of incubation when the incipient limiting level (96% saturation) exceeded the environmental oxygen saturation (94.3%) to which the eggs were exposed. A field survey of 26 commercial catfish hatcheries in the Mississippi delta was conducted during the 2005 spawning season. The hatcheries sampled represent approximately 40% of the annual hatching capacity of the 1.8-billion-fry industry. Oxygen saturation in the hatching troughs sampled ranged from 45.2% to 100.2%. Nearly half of the hatcheries (12 of 26) maintained DO at less than 90% saturation (7.2 mg/L at 26.7 C/80 F), while only 7 of 26 maintained DO at over 96% saturation (7.8 mg/L at 26.7 C). It is possible that production of swim-up fry could be increased by as much as 200-400 million/year by maintaining water at >96% oxygen saturation during the last day of incubation.