A general physiological model for the hemodynamic response during altered blood flow, oxygenation, and metabolism is presented. Calculations of oxy-, deoxy-, and total hemoglobin changes during stimulation are given. It is shown that by using a global hyperoxic or mild hypoxic challenge it is possible to normalize the activation response in terms of the fractional changes in the cerebral blood volume, tissue oxygenation index, and oxygen extraction ratio, which are independent of the optical pathlength. Using a dual wavelength spectrometer, the method is validated by measuring pathlength-independent hemodynamic responses during mild hypercarbia in a rat model. Phantom experiments showed that the changes in optical pathlength were small as the hemoglobin concentration was varied over a wide range. The determination of quantitative parameters facilitates the use of continuous-wave transcranial methods by providing a means by which to characterize activation response across subjects.