The effects of dissolved air in the dielectric liquid FC-77 on flow boiling in a microchannel heat sink containing ten parallel channels, each wide and deep, were experimentally investigated. Experiments were conducted before and after degassing, at three flow rates in the range of . The dissolved air resulted in a significant reduction in wall temperature at which bubbles were first observed in the microchannels. Analysis of the results suggests that the bubbles observed initially in the undegassed liquid were most likely air bubbles. Once the boiling process is initiated, the wall temperature continues to increase for the undegassed liquid, whereas it remains relatively unchanged in the case of the degassed liquid. Prior to the inception of boiling in the degassed liquid, the heat transfer coefficients with the undegassed liquid were higher than for degassed liquid, depending on the flow rate. The heat transfer coefficients for both cases reach similar values at high heat fluxes once the boiling process with the degassed liquid was well established. The boiling process induced a significant increase in pressure drop relative to single-phase flow; the pressure drop for undegassed liquid was measured to be higher than for degassed liquid once the boiling process became well established in both cases. Flow instabilities were induced by the boiling process, and the magnitude of the instability was quantified using the standard deviation of the measured pressure drop at a given heat flux. It was found that the magnitude of flow instability increased with increasing heat flux in both the undegassed and degassed liquids, with greater flow instability noted in the undegassed liquid.