Psychological stress can affect female reproduction by deteriorating oocyte quality, but the molecular mechanism is unclear. In this study, we used the chronic unpredictable stress model to study the effect of psychological stress on mouse oocyte competence during preimplantation stage, and RNA sequencing in single oocytes to analyze differential gene expression at the transcription level. Stress changed the serum levels of glucocorticoids and reduced oocyte developmental potential, depending on the strength of the stress. Strong stress (two stressors per day) reduced the fertilization rate and induced significant apoptosis in blastocysts. Moderate stress (one stressor per day) reduced the cleavage rate and blastocyst formation rate. Weak stress (one stressor every 2 days) did not have any significant negative effect on the fertilization, cleavage, and blastocyst formation. Hatching rate was not affected by stress, but stress retarded the development of the expanded blastocysts and inhibited the embryo development at early stages. Transcriptome analysis revealed that stress disturbed the expression of cell cycle regulators and apoptotic genes. The hub genes identified through protein‐protein interaction analysis include Msln, Ceacam12, Psg16, Psg17, and Psg23, which are all carcinoembryonic or related genes involved in cell adhesion, proliferation, and migration. Thus, stress was inhibitory on fertilization and early embryo development in mice.