It is unknown whether hypoxemia, a hallmark of fibrotic interstitial lung disease (f-ILD), may impair cerebral oxygenation during exercise in these patients. Twenty-seven patients [23 males, 72 ± 8 years, lung diffusing capacity for carbon monoxide (DLCO) = 44 ± 11 % predicted] and 12 controls performed an incremental bicycle test. Prefrontal oxygenation [tissue saturation index (TSI)] was assessed by near-infrared spectroscopy. Patients showed lower arterial O2 saturation (SpO2) and larger fall in cerebral TSI during exercise vs controls (p < 0.05). However, changes (Δ) from rest to peak-exercise in SpO2 (-2.2 % to -26.9 %) and TSI (1.4 % to -16.6 %) varied substantially among patients. In the 16 patients showing significant cerebral deoxygenation (Δ TSI ≥ 4% based on controls), SpO2 decreased more (-12.6 ± 6.7 % vs -5.7 ± 2.8 %, p = 0.001) and peak O2 uptake was lower (68.3 ± 19.2 % vs 87.8 ± 24.8 % predicted, p = 0.03) vs their 11 counterparts. In association with DLCO and forced vital capacity, Δ cerebral TSI independently predicted peak O2 uptake on multivariable regression analysis (R2 = 0.54). Exertional hypoxemia impairs cerebral oxygenation in a dose-dependent fashion in f-ILD. Future studies are warranted to investigate whether this potentially reversible abnormality play a contributory role in limiting exercise tolerance in these patients.