The cause of reduced fecundity in women with endometriosis is unknown. Expression of matrix metalloproteinases (MMPs) and their inhibitors (TIMPs) by both ectopic and eutopic endometrium reportedly play a role in the pathogenesis of endometriosis. We hypothesize that anomalous endometriotic TIMP protein synthesis, secretion, and localization also cause reproductive pathologies resulting in reduced fecundity. An established rat model for endometriosis (Endo) compared to non-endometriotic controls (Sham) was used to investigate reduced fecundity in endometriosis. Comparing Endo and Sham rats, Endo rats had altered ovarian dynamics including fewer ovarian follicles and corpora lutea (CL) with luteinized unruptured follicles. Further, in vivo anomalies in post-ovulatory oocyte structure and preimplantation embryo development including misaligned chromosomes, nuclear and cytoplasmic fragmentation and delayed or arrested cleavage as well as spontaneous abortions were found only in Endo rats. A causative role for TIMP-1 in these phenomena is supported by our findings that Endo rats have more TIMP-1 in their peritoneal fluid as detected by ELISA and more TIMP-1 immunolocalization in the theca of antral follicles as measured by computer-assisted morphometric analysis. These data suggest that in endometriosis, accumulation of TIMP-1 disrupts the normal MMP/TIMP enzymatic milieu in the peritoneal cavity and negatively impacts ovarian dynamics, oocyte quality and preimplantation embryo development, thereby decreasing fecundity. Most intriguingly, daughters from Endo rats which had no experimental interventions exhibited these same reproductive abnormalities. We predict that developmental exposure to endometriosis leads to permanent epigenetic changes in subsequent generations.