Where does the exchange of carbon dioxide and oxygen with the blood occur?

between the capillaries surrounding the alveolar sac and the alveoli. woo hoo

it occurs somewhere in the lungs. sorry, i cant get anymore specific than that. sorry, though. :o(

RESPIRATORY

Ericaemily8's improved answer (instead of her's) (The one above mine is someone elses):

It happens at the capillaries, the red blood cells carry the Carbon Dioxide to the capillaries which dispose of it in the human body, that is why you have gas. The capillaries which had oxygen to start with then give the oxygen to the red blood cells which carry it all around your body, mostly your heart.