To improve the use of renewable energy sources and increase their penetration in the renewable energy market, different types of energy storage technologies have been introduced among which compressed air energy storage (CAES) systems offer more competitive feature. In this paper, a comprehensive exergy analysis of a one-stage, adiabatic compressed air energy storage (A-CAES) system is carried out for a wide range of parameters. The governing parameters on the system performance include, but not limited to, storage pressure, pre-set vessel pressure as well as isentropic efficiencies of the major components involved in the A-CAES systems most specifically compressor and expander. By performing the exergy analysis and using the concept of exergy destruction, which is a criterion for power loss due to the irreversibility, the magnitude and source of thermodynamic inefficiencies at each part of the system is identified. The obtained results reveal that the isentropic efficiency of the machine has a significant effect on the amount of exergy destructed by the machine. In addition, the results show that generally more exergy is lost in the expander than other components of the A-CAES system during the system operation. Consequently, to improve the system performance, utilising a high-efficient expander should be a priority. It is also shown that increase in the storage pressure improves the exergy efficiency of the compressor and expander. Using the obtained results, it would be possible to find the optimum working condition for the system leading to improvement of the system performance.