We investigate optimal rotable inventory control for maintenance, repair, and overhaul (MRO) service providers operating under stochastic demand and service rates within the context of an equipment exchange policy. In this setting, the provider fulfills service requests by exchanging the customer’s equipment with a ready-to-use unit from its rotable (exchange) inventory. Orders are admitted only when inventory is available for immediate exchange, making inventory availability a key determinant of effective demand. We develop a queueing-based model to characterize the system dynamics and derive profit-maximizing inventory policies. Through analytical results and extensive numerical analysis, we explore how cost parameters, arrival rates, service rates, and capacity interact to influence optimal inventory positions. Our findings demonstrate that optimal inventory levels are highly sensitive to both economic and operational factors, such as the ratio of holding cost to exchange premium, traffic intensity, and service capacity. The results also highlight several non-monotonic relationships between operational parameters and inventory levels, offering nuanced insights into the strategic design of exchange-based MRO systems.