Oxygen free radicals, including the highly toxic hydroxyl radical (*OH), initiate lipid peroxidation and DNA/RNA fragmentation and damage cells. The pineal hormone melatonin is an antioxidant and powerful scavenger of *OH. We hypothesized that maternally administered melatonin could reduce *OH formation, lipid peroxidation, and DNA/RNA damage in the fetal brain in response to asphyxia. In 15 fetal sheep, extracellular *OH was measured by microdialysis in white and gray matter of the parasagittal cortex. In 10 fetuses, asphyxia was induced by umbilical cord occlusion for 10 min using an inflatable cuff - the ewes of these fetuses received either intravenous melatonin (1 mg bolus, then 1 mg/h for 2 h; n = 5) or vehicle (1% ethanol in saline; n = 5), and results were compared to fetuses with sham cord occlusion and vehicle-infused ewes (n = 5). Hypoxemia, acidemia, hypertension and bradycardia produced by cord occlusion was similar in the melatonin- and vehicle-treated groups. In the vehicle-treated group, cord occlusion resulted in a significant increase in *OH in gray matter at 8-9.5 h after occlusion (p < 0.05); in contrast, there was no *OH change in the melatonin-treated group. After cord occlusion, lipid peroxidation (4-hydroxynonenal immunoreactivity) found throughout the brain of vehicle-infused ewes was significantly less in the melatonin-infused group. Melatonin had no significant effect on the distribution of DNA/RNA fragmentation, as shown by 8-hydroxydeoxyguanosine immunoreactivity. Thus, brief asphyxia results in significant and delayed entry of *OH into the extracellular space of cortical gray matter in the fetal sheep brain, and melatonin given to the mother at the time of the insult abrogates this increase. Melatonin, in reducing O2 free radical production, may be an effective neuroprotective treatment for the fetus.