The gill is the primary site of ionoregulation and gas exchange in adult teleost fishes. However, those characteristics that benefit diffusive gas exchange (large, thin gills) may also enhance the passive equilibration of ions and water that threaten osmotic homeostasis. Our literature review revealed that gill surface area and thickness were similar in freshwater (FW) and seawater (SW) species; however, the diffusive oxygen (O2) conductance (Gd) of the gill was lower in FW species. While a lower Gd may reduce ion losses, it also limits O2 uptake capacity and possibly aerobic performance in situations of high O2 demand (e.g. exercise) or low O2 availability (e.g. environmental hypoxia). We also found that FW fishes had significantly higher haemoglobin (Hb)-O2 binding affinities than SW species, which will increase the O2 diffusion gradient across the gills. Therefore, we hypothesized that the higher Hb-O2 affinity of FW fishes compensates, in part, for their lower Gd. Using a combined literature review and modelling approach, our results show that a higher Hb-O2 affinity in FW fishes increases the flux of O2 across their low-Gd gills. In addition, FW and SW teleosts can achieve similar maximal rates of O2 consumption (ṀO2,max) and hypoxia tolerance (Pcrit) through different combinations of Hb-O2 affinity and Gd. Our combined data identified novel patterns in gill and Hb characteristics between FW and SW fishes and our modelling approach provides mechanistic insight into the relationship between aerobic performance and species distribution ranges, generating novel hypotheses at the intersection of cardiorespiratory and ionoregulatory fish physiology.