Downhole upgrading of virgin Athabasca Tar Sand bitumen has been investigated in a series of 3-D experiments using THAI-'Toe-to-Heel Air Injection'. The THAI process uses combinations of vertical injection wells and horizontal producer wells, arranged in a direct, or staggered line drive. 3-D experiments were performed to investigate THAI as a primary recovery method, and also as a secondary recovery method. The latter followed a prior THSF-'Toe-to-Heel Steam Flood'. Oil recovery efficiencies for THAI, using primary and secondary operation modes, were respectively, 80% and 67% OOIP. The THSF recovery was much lower, only 23% OOIP, owing to the low steam temperature in the sandpack. Downhole upgrading of the Athabasca Tar Sand bitumen was very significant, with the API gravity of the produced oil increasing by an average of 8 degrees API, compared to the original bitumen. The produced oil viscosity was also dramatically reduced, to less than 200 mPa s, with a minimum value of 50 mPa s. SARA analysis was used to assess the quality of the produced oil. The original bitumen contained only 15.5% saturates, but the amount in the produced oil was increased to 72%. The high oil recovery factor and partial in situ upgrading achieved by the THAI process could therefore have important economic implications for the future of heavy oil and bitumen production. The first field pilot of the THAI process is scheduled to take place at Christina Lake, Alberta, Canada, in 2006.