Artificial blood for clinical use is not yet available therefore, we previously developed artificial oxygen carriers (capsules) and showed their functionality in vitro and biocompatibility in vivo. Herein, we assessed the functionality of the capsules in vivo in a normovolemic hemodilution rat-model. We stepwise exchanged the blood of male Wistar-rats with medium either in the presence of capsules (treatment) or in their absence (control). We investigated tissue hypoxia thoroughly through online biomonitoring, determination of enzyme activity and pancreatic hormones in plasma, histochemical and immunohistochemical staining of small intestine, heart, liver and spleen as well as in situ hybridization of kidneys. After hemodilution, treated animals show higher arterial blood pressure and have a stable body temperature. Additionally, they show a more stable pH, a higher oxygen partial pressure (pO₂), and a lower carbon dioxide partial pressure (pCO₂). Interestingly, blood-glucose-levels drop severely in treated animals, presumably due to glucose consumption. Creatine kinase values in these animals are increased and isoenzyme analysis indicates the spleen as origin. Moreover, the small intestine of treated animals show reduced hypoxic injury compared to controls and the kidneys have reduced expression of the hypoxia-inducible erythropoietin mRNA. In conclusion, our capsules can prevent hypoxic tissue damage. The results provide a proof of concept for capsules as adequate erythrocyte substitute.