Diabetic embryopathy is the leading cause of neonatal death and/or congenital malformations in infants of diabetic mothers. Because the development of the embryo critically depends on the maternal and the embryonic signaling pathways, a defective signaling mechanism between the maternal and the embryonic tissues appears to be involved in the etiology of diabetic embryopathy. Analyses of the recent studies from different laboratories suggest a "multifactorial" basis for diabetic embryopathy. These studies suggest that a wide variety of signal-transducers converge towards the regulation of elcosanoid signaling pathway which appears to be the critical pathway involved in diabetic embryopathy. The characterization of the regulatory components of this pathway is likely to identify the signaling loci susceptible for the therapeutic intervention.