Bovine embryos are typically cultured at reduced oxygen tension to lower the impact of oxidative stress on embryo development. However, oocyte in vitro maturation (IVM) is performed at atmospheric oxygen tension since low oxygen during maturation has a negative impact on oocyte developmental competence. Lycopene, a carotenoid, acts as a powerful antioxidant and may protect the oocyte against oxidative stress during maturation at atmospheric oxygen conditions. Here, we assessed the effect of adding 0.2 μM lycopene (antioxidant), 5 μM menadione (pro-oxidant), and their combination on the generation of reactive oxygen species (ROS) in matured oocytes and the subsequent development, quality, and transcriptome of the blastocysts in a bovine in vitro model. ROS fluorescent intensity in matured oocytes was significantly lower in the lycopene group, and the resulting embryos showed a significantly higher blastocyst rate on day 8 and a lower apoptotic cell ratio than all other groups. Transcriptomic analysis disclosed a total of 296 differentially expressed genes (Benjamini–Hochberg-adjusted p < 0.05 and ≥ 1-log2-fold change) between the lycopene and control groups, where pathways associated with cellular function, metabolism, DNA repair, and anti-apoptosis were upregulated in the lycopene group. Lycopene supplementation to serum-free maturation medium neutralized excess ROS during maturation, enhanced blastocyst development and quality, and modulated the transcriptomic landscape.