In the premature infant, periventricular leukomalacia, usually related to hypoxicischemic white matter damage, is the main cause of neurological impairment. We hypothesized that protracted prenatal hypoxia might induce white matter damage during the perinatal period. Pregnant Sprague-Dawley rats were placed in a chamber supplied with hypoxic gas (10% O2-90% N2) from embryonic day 5 (E5) to E20. Neonatal rat brains were investigated by histology, immunocytochemistry, western blotting, in situ hybridization, DNA fragmentation analysis, and in vivo magnetic resonance imaging (MRI). Body weight of pups subjected to prenatal hypoxia was 10 to 30% lower from P0 to P14 than in controls. Specific white matter cysts were detected between P0 and P7 in pups subjected to prenatal hypoxia, in addition to abnormal extra-cellular matrix, increased lipid peroxidation, white matter cell death detected by TUNEL, and increased activated macrophage counts in white matter. Subsequently, gliotic scars and delayed myelination primarily involving immature oligodendrocytes were seen. In vivo MRI with T1, T2, and diffusion sequences disclosed similar findings immediately after birth, showing strong correlations with histological abnormalities. We speculate that protracted prenatal hypoxia in rat induces white matter damage occurring through local inflammatory response and oxidative stress linked to re-oxygenation during the perinatal period.