Pre-term birth is associated with numerous cardio-respiratory sequelae in children. Whether these impairments impact the responses to exercise in normoxia or hypoxia remains to be established. Fourteen prematurely-born (PREM) (Mean ± SD; gestational age 29 ± 2 weeks; age 9.5 ± 0.3 years), and 15 full-term children (CONT) (gestational age 39 ± 1 weeks; age 9.7 ± 0.9 years), underwent incremental exercise tests to exhaustion in normoxia (FiO₂ = 20.9%) and normobaric hypoxia (FiO₂ = 13.2%) on a cycle ergometer. Cardio-respiratory variables were measured throughout. Peak power output was higher in normoxia than hypoxia (103 ± 17 vs. 77 ± 18 W; p < 0.001), with no difference between CONT and PREM (94 ± 23 vs. 86 ± 19 W; p = 0.154). VO₂peak was higher in normoxia than hypoxia in CONT (50.8 ± 7.2 vs. 43.8 ± 9.9 mL·kg⁻¹·min⁻¹; p < 0.001) but not in PREM (48.1 ± 7.5 vs. 45.0 ± 6.8 mL·kg⁻¹·min⁻¹; p = 0.137; interaction p = 0.044). Higher peak heart rate (187 ± 11 vs. 180 ± 10 bpm; p = 0.005) and lower stroke volume (72 ± 13 vs. 77 ± 14 mL; p = 0.004) were observed in normoxia versus hypoxia in CONT, with no such differences in PREM (p = 0.218 and >0.999, respectively). In conclusion, premature birth does not appear to exacerbate the negative effect of hypoxia on exercise capacity in children. Further research is warranted to identify whether prematurity elicits a protective effect, and to clarify the potential underlying mechanisms.