Antithyroid drugs (ATDs) are preferred for the treatment of hyperthyroidism caused by Graves' disease in pregnant women. The drugs have been a recognized treatment for decades, and a general risk of side effects is known. For the use of ATDs in pregnancy, a concern about teratogenic side effects has been brought forward since the 1970s. In more recent years, a number of large observational studies have added new evidence and quantified the risk of birth defects associated with different types of ATDs. The findings that both Methimazole (MMI) and Propylthiouracil (PTU) are associated with birth defects have challenged the clinical recommendations on the treatment of hyperthyroidism in pregnancy, and certain aspects remain unclarified. In this review, the current evidence on the risk of birth defects associated with the use of ATDs in early pregnancy is described, and determinants of causality are discussed. This includes the current evidence of a biological gradient and the role of maternal thyroid function per se. Finally, clinical aspects of the timing and type of treatment is discussed, and future perspectives are addressed. Current evidence corroborates a risk of birth defects associated with MMI while more evidence is needed to determine the teratogenic potential of PTU. Detailed assessment of type and timing of exposure in large cohorts are needed. Moreover, studies investigating alternative or new treatments are warranted.