Intrauterine growth restriction (IUGR) is a major cause of perinatal death and neonatal morbidity and mortality. There are numerous causes of IUGR. Glucocorticoid-induced IUGR is highly relevant because administration of synthetic glucocorticoids, principally dexamethasone, to women threatened by premature labor is widely used in clinical practice. Fetal growth is directly related to placental growth and development. In this report, we analyzed the effect of dexamethasone on placental development in the rat. Dexamethasone administered between days 13 and 20 of pregnancy not only induced IUGR but also decreased placental mass by approximately 50%. Impaired placental development was associated with dysregulated placental prolactin (PRL) family and insulin-like growth factor-II (IGF-II) gene expression. Furthermore, there was a significant decrease in the activation of Akt/protein kinase B in the junctional zone of the placenta, as assessed by the phosphorylation status of Akt and the pro-apoptotic protein BAD, a downstream target of the Akt signaling pathway. Such changes are consistent with increases in indices of apoptosis, including increased cleavage of poly(ADP-ribose) polymerase (PARP) in the junctional zone of the placenta of dexamethasone-treated rats. In summary, dexamethasone-induced IUGR is associated with placental insufficiency, including dysregulated placental hormone/cytokine gene expression and down-regulation of the IGF-II/Akt signaling pathway resulting in increases in indices of placental apoptosis.