TLCO is a Lung function test measuring the diffusing capacity of the lungs for carbon monoxide (Tlco) is commonly measured with the Morgan transfer test and the single breath method. The carbon monoxide uptake from a single inspiration in a standard time (usually 10s). Alveolar volume (VA) is the total lung capacity at the time when the Tlco is measured. The specific diffusing capacity is Tlco/VA (often referred to as the transfer factor for Carbon Monoxide). It is reduced in destructive lung diseases that attack the alveoli and so will hinder the transfer of carbon monoxide - for example emphysema

Emphysema

Emphysema is a long-term, progressive disease of the lungs that primarily causes shortness of breath. In people with emphysema, the tissues necessary to support the physical shape and function of the lungs are destroyed. It is included in a group of diseases called chronic obstructive pulmonary...

 and interstitial lung disease - and high in alveolar haemorrhage.