Recent observations have been interpreted to suggest altered ventricular function during ventilation with positive end-expiratory pressure (PEEP), apart from the effect of reduced preload. We constructed ventricular function curves in 14 anesthetized dogs as PEEP was varied under closed- and open-chest conditions. The systemic venous flow of the animal was diverted through an external circuit so that blood return to the right atrium could be varied stepwise from 1--4.5 l/min before and after 15 cmH2O PEEP was applied to the airway. Pressures adjacent to the heart were measured with thin fluid-filled water sensors to enable estimation of transmural pressure. Alterations in ventricular function were assessed by comparing tangential slopes as well as the atrial pressure differences separating the curves at high and low stroke volumes. Sensitivity of this method to cardiac depression was demonstrated by similar comparisons made before and after propranolol. Curves using transmural pressure on and off PEEP were statistically indistinguishable. We conclude that hemodynamic changes resulting from PEEP are attributable to the combined effects of reduced preload and raised juxtacardiac pressure, without ventricular dysfunction.