Pulmonary surfactant is synthesized by type II alveolar epithelial cells to regulate the surface tension at the air-liquid interface of the air-breathing lung. Developmental maturation of the surfactant system is controlled by many factors including oxygen, glucose, catecholamines, and cortisol. The intrauterine growth-restricted (IUGR) fetus is hypoxemic and hypoglycemic, with elevated plasma catecholamine and cortisol concentrations. The impact of IUGR on surfactant maturation is unclear. Here we investigate the expression of surfactant protein (SP) A, B, and C in lung tissue of fetal sheep at 133 and 141 days of gestation (term 150 +/- 3 days) from control and carunclectomized Merino ewes. Placentally restricted (PR) fetuses had a body weight <2 SD from the mean of control fetuses and a mean gestational Pa(O(2)) <17 mmHg. PR fetuses had reduced absolute, but not relative, lung weight, decreased plasma glucose concentration, and increased plasma cortisol concentration. Lung SP-A, -B, and -C protein and mRNA expression was reduced in PR compared with control fetuses at both ages. SP-B and -C but not SP-A mRNA expression and SP-A but not SP-B or -C protein expression increased with gestational age. Mean gestational Pa(O(2)) was positively correlated with SP-A, -B, and -C protein and SP-B and -C mRNA expression in the younger cohort. SP-A and -B gene expression was inversely related to plasma cortisol concentration. Placental restriction, leading to chronic hypoxemia and hypercortisolemia in the carunclectomy model, results in significant inhibition of surfactant maturation. These data suggest that IUGR fetuses are at significant risk of lung complications, especially if born prematurely.