Altitude-induced hypoxemia impairs exercise performance and cognition. Interestingly, ketone ester (KE) ingestion may attenuate hypoxemia, which likely explains the observation that KE impairs high-intensity exercise performance in normoxia but not in hypoxia. Moreover, KE was reported to attenuate cognitive decline at extreme altitudes (∼6,100 m). Given that hypoxemia is unaffected by KE in milder conditions, the impact of KE on cognition and performance in the absence of elevated oxygenation remains unknown. As KE may increase postexercise circulating [erythropoietin] ([EPO]) at sea level, we also assessed if KE might augment the blood [EPO] response after hypoxic exercise. In a double-blind, cross-over design, 13 healthy, male participants completed two 5.5-h sessions at 4,000-m simulated altitude while receiving either KE or placebo (CON). Throughout a graded exercise test (EXMAX) after 1.5 h, and a submaximal exercise bout (EXSUBMAX) after 3 h, blood and tissue oxygenation, ventilatory parameters, and acid-base balance were evaluated. Other measurements included cognitive function and blood [EPO]. KE reduced power output achieved during EXMAX by 3.6%, whereas blood and cerebral oxygenation were similar. KE ingestion lowered blood pH, [], pCO2, and [glucose], but did not impact cognitive function. In both KE and CON, circulating [EPO] increased by ∼56% after 5 h. These results indicate that KE ingestion impairs high-intensity exercise performance, at least if not compensated by elevated oxygenation. A progressively increasing oxygenation upon KE was unable to protect against hypoxia-induced cognitive declines and potentially counteracted a KE-induced augmentation of circulating [EPO]. NEW & NOTEWORTHY This study is the first to show that KE ingestion impairs exercise performance in hypoxia, at least when KE does not alleviate hypoxemia. Despite a subsequent, progressive increase in oxygenation upon KE after 3–4 h, this does not protect against hypoxia-induced cognitive declines. Although studies in normoxia show potential of KE to increase blood [erythropoietin], we identified that KE ingestion fails to augment the increase in blood [erythropoietin] through hypoxic exposure and exercise.