The function of the alveoli is to assist in oxygen exchange through the membranes of the small balloon-like structures. The alveoli are found on the branches of the bronchial passages.
The alveoli have an elastic-like structure, which means that there is an amount of effort needed to inhale oxygen into the lungs, but that same structure assists with exhaling. The process of breathing is also made easier by a liquid that coats the alveoli and reduces the surface tension on the structures. This fluid is called surfactant, which reduces the surface tension by a factor of approximately 15. This allows the alveoli to inflate with a very small change in pressure.