Objective: Pulse oximetry is commonly used in Neonatology, however recent adult data suggest racial disparity in accuracy, with overestimation of oxygen saturation for Black patients. Study design: Black and White infants <32 weeks gestation underwent simultaneous arterial blood gas and pulse oximetry measurement. Error by race was examined using mean bias, Arms, Bland–Altman, and linear/non-linear analysis. Results: A total of 294 infants (124 Black, 170 White) were identified with mean GA of 25.8 ± 2.1 weeks and mean BW of 845 ± 265 grams, yielding 4387 SaO2–SpO2 datapoints. SpO2 overestimation, measured by mean bias, was 2.4-fold greater for Black infants and resulted in greater occult hypoxemia (SpO2 > 90% when SaO2 < 85%; 9.2% vs. 7.7% of samples). Sensitivity and specificity for detection of true hypoxemia were similar between groups (39 vs. 38%; 81 vs. 78%). Conclusion: There is a modest but consistent difference in SpO2 error between Black and White infants, with increased incidence of occult hypoxemia in Black infants.