Subcutaneous injections of 40 mumol/kg of CdCl2 given to rats on day 18 of pregnancy produced a high incidence of fetal death and placental necrosis. Fetuses directly injected with CdCl2 in utero were resistant to cadmium levels far in excess of fetal levels associated with fetal death following maternal injection. Thus cadmium-induced fetal death was not the result of a direct effect of cadmium on the fetus. Similarly, exposure of fetuses or dams to Cd-metallothionein did not produce fetal death. Placental histological changes and high placental accumulations of cadmium suggested placental mechanisms for the toxicity. Histological changes were observed as early as 12 hours after injection and were characteristic of local circulatory responses. Blood flow measurements with radiolabelled microspheres indicated that uteroplacental blood flow was decreased 40 per cent and 75 per cent at 12-16 hours and 18-24 hours after injection. Studies on the initial responses of the placenta to cadmium exposure revealed that biochemical and ultrastructural changes could be observed in the placenta prior to alterations in blood flow and fetal death. No ultrastructural changes were observed in the uterine vascular endothelium. Thus cadmium-induced fetal death was not the result of direct effects of cadmium but may be the result of a placental effect of the heavy metal. A proposed mechanism for the induction of fetal death is that high placental accumulations of cadmium result in trophoblastic damage which leads to a local circulatory response to the injured tissues and a decrease in uteroplacental blood flow. It is the decrease in nutrient and oxygen transport to the fetus that results from trophoblastic damage and blood flow alterations that ultimately induce fetal death.