Dynamic modelling of physiological processes from an engineering perspective and its applications in medicine have been broadly studied in the past few years. In this article, a lumped parameter dynamic model of the physiological respiration process concerning gas transfer and blood transport is developed. The proposed model is based on conservative principles and causal equations and it is qualitatively validated afterwards with information found in medical literature. The resulting model is able to describe the processes of gas transfer and blood transport of physiological respiration in a healthy human being and provides parameter interpretability, which is highly advantageous for possible upcoming applications.