Absolute blood flow and blood volume measurements using perfusion weighted MRI require an accurately measured arterial input function (AIF). Because of limited spatial resolution of MR images, AIF voxels cannot be placed completely within a feeding artery. We present a two-compartment model of an AIF voxel including the relaxation properties of blood and tissue. Artery orientations parallel and perpendicular to the main magnetic field were investigated and AIF voxels were modeled to either include or be situated close to a large artery. The impact of partial volume effects on quantitative perfusion metrics was investigated for the gradient echo pulse sequence at 1.5 T and 3.0 T. It is shown that the tissue contribution broadens and introduces fluctuations in the AIF. Furthermore, partial volume effects bias perfusion metrics in a nonlinear fashion, compromising quantitative perfusion estimates and profoundly effecting local AIF selection. Magn Reson Med, 2009. © 2009 Wiley-Liss, Inc.