Aerated liquid drilling (ALD) is defined as drilling operations using aerated liquid as drilling fluids. The ALD technology has been used to produce oil and gas from low-pressure reservoirs for over a decade. The advantages of aerated liquid drilling include minimized formation damage, reduced loss of circulation problems, increased rate of penetration, and improved drilling performance. The major problem with using aerated drilling fluids is borehole collapse which causes drilling complications. In-addition to the low-level borehole pressure, fluctuation in the borehole pressure has also been recognized as one of the factors affecting borehole stability in aerated liquid drilling. This paper focuses on analyses of bottomhole pressure fluctuations due to a break in circulation and backpressure variation. The pressure fluctuation due to breaking circulation is characterized by the gradient loss (GL), defined as the equivalent circulating density (ECD) less the equivalent mud density (EMD). The pressure fluctuation due to backpressure change is evaluated using the pressure instability a factor (PIF) defined as the ratio of change in the bottomhole pressure to the change in the surface choke pressure. Sensitivity analyses with an analytical model indicate that the GL decreases with depth and backpressure, and increases with both liquid pumping rate and gas injection rate. The PIF increases with depth and backpressure, and decreases with both; liquid pumping rate and gas injection rate. At a given depth and backpressure, it is the combination of liquid and gas flow rates, rather than the injection GLR, that determines the PIF. Following a change in backpressure, the transition time for borehole pressure to stabilize at a new level depends on several factors including well depth, well geometry, and liquid pumping rate. This paper presents an easy-to-use method for predicting pressure fluctuations and identifying key factors affecting the pressure stability in aerated liquid drilling. The results can be applied to designing of hydraulics for underbalanced drilling (UBD) and managed pressure drilling (MPD) wells.