Multicellular organisms show adaptive reactions for their survival when they are exposed to an atmosphere with reduced oxygen concentration. These reactions include increase in respiratory volume, switch from aerobic to anaerobic metabolism, erythropoiesis and angiogenesis. For these reactions, cells must change the expression of several hypoxia-responsive molecules such as erythropoietin and vascular endothelial growth factor. Hypoxia-responsible element (HRE) was delineated in the genes of hypoxia-responsive molecules as the sequence indispensable for their hypoxia-induced transcriptional activation, and hypoxia-inducible factor 1 (HIF-1) was identified as a transcriptional factor that binds to HRE and regulates the expression of various hypoxia-responsive molecules. Increasing evidence has revealed that HIF-1 is a key molecule regulating the cellular response to tissue hypoxia. HIF-1 is composed of two subunits, HIF-1alpha and HIF-1beta, and HIF-1 activity depends mainly on the intracellular level of HIF-1alpha protein, which is regulated to be in inverse relation to the oxygen concentration by an oxygen-dependent enzyme, prolyl hydroxylase 2 (PHD2). Thus, cells respond to tissue hypoxia by sensing the oxygen concentration as the enzyme activity of PHD2, regulating the HIF-1 activity and consequently changing the expression of various hypoxia-responsive molecules. Cellular response controlled by hypoxia-HIF-1 cascade is also involved in pathological situations such as solid tumor growth, diabetic retinopathy and rheumatoid arthritis. Under these pathological situations, the activation of hypoxia-HIF-1 cascade often leads to the acceleration of disease progression. Understanding an aspect of disease progression triggered by tissue hypoxia might provide a clue to new therapeutic strategies for intractable diseases.