From my physiology class...if you mean the gas exchange (CO2-O2), it occurs at the alveoli level. These are part of the bronchioles which are branches of the bronchi which are branches of the trachea. Alveolis are located within the lungs.
Breathing takes place in many areas. All of the areas of entry where oxygen enters the body is involved such as the mouth and nasal passages, the trachea, the bronchi, the lungs, even the blood stream because that is where the actual exchange of these gases occur.