An alveolus is an anatomical structure that has the form of a hollow cavity. Found in the lung parenchyma, the pulmonary alveoli are the terminal ends of the respiratory tree, which outcrop from either alveolar sacs or alveolar ducts, which are both sites of gas exchange with the blood as well. Alveoli are particular to mammalian lungs. Different structures are involved in gas exchange in other vertebrates. The alveolar membrane is the gas-exchange surface. Carbon dioxide rich blood is pumped from the rest of the body into the alveolar blood vessels where, through diffusion, it releases its carbon dioxide and absorbs oxygen.
source:wikipedia\Image by: Pulmonary Pathology