The purpose of this study was to determine how severe acute hypoxia alters neural mechanisms during, and following, a sustained fatiguing contraction. Fifteen participants (25 ± 3.2 years, six female) were exposed to a sham condition and a hypoxia condition where they performed a 10 min elbow flexor contraction at 20% of maximal torque. For hypoxia, peripheral blood oxygen saturation ((Formula presented.)) was titrated to 80% over a 15 min period and maintained for 2 h. Maximal voluntary contraction torque, EMG root mean square, voluntary activation, rating of perceived muscle fatigue, and corticospinal excitability (motor-evoked potential) and inhibition (silent period duration) were then assessed before, during and for 6 min after the fatiguing contraction. No hypoxia-related effects were identified for neuromuscular variables during the fatigue task. However, for recovery, voluntary activation assessed by motor point stimulation of biceps brachii was lower for hypoxia than sham at 4 min (sham: 89% ± 7%; hypoxia: 80% ± 12%; P = 0.023) and 6 min (sham: 90% ± 7%; hypoxia: 78% ± 11%; P = 0.040). Similarly, voluntary activation (P = 0.01) and motor-evoked potential area (P = 0.002) in response to transcranial magnetic stimulation of the motor cortex were 10% and 11% lower during recovery for hypoxia compared to sham, respectively. Although an (Formula presented.) of 80% did not affect neural activity during the fatiguing task, motor cortical output and corticospinal excitability were reduced during recovery in the hypoxic environment. This was probably due to hypoxia-related mechanisms involving supraspinal motor circuits. (Figure presented.). Key points: Acute hypoxia has been shown to impair voluntary activation of muscle and alter the excitability of the corticospinal motor pathway during exercise. However, little is known about how hypoxia alters the recovery of the motor system after performing fatiguing exercise. Here we assessed hypoxia-related responses of motor pathways both during active contractions and during recovery from active contractions, with transcranial magnetic stimulation and motor point stimulation of the biceps brachii. Fatiguing exercise caused reductions in voluntary activation, which was exacerbated during recovery from a 10 min sustained elbow flexion in a hypoxic environment. These results suggest that reductions in blood oxygen concentration impair the ability of motor pathways in the CNS to recover from fatiguing exercise, which is probably due to hypoxia-induced mechanisms that reduce output from the motor cortex.