The widely used technique for determining optical gain and absorption from single-pass, amplified spontaneous emission (ASE) is analyzed with particular attention given to active-volume saturation and three-dimensional effects. The results for homogeneously broadened media show that the population inversion and hence the gain in the active region is diminished by high levels of spontaneous and ASE. The externally measured gain is further reduced for large output collection apertures that admit incompletely amplified off-axis rays. Criteria are given for the excitation and detection geometries required to ensure accurate (∼10-percent) gain measurement. The simultaneous measurement of the equilibrium absorption coefficient can be made under less restrictive conditions.