At least 100 mammalian species exhibit embryonic diapause, where fertilized embryos arrest development in utero until suitable seasonal or nutritional environments are encountered. Delaying maternal investments in producing offspring allows these animals to utilize limited resources to survive while searching for better conditions and ensures that progeny are not produced when they are unlikely to survive. In addition, embryos may be protected from external environmental vicissitudes while in utero. Here we demonstrate embryonic diapause in C. elegans, and show that this diapause protects embryos from otherwise lethal hypoxia. Diapausing embryos in utero require san-1 to survive, indicating that hypoxia-induced embryonic diapause may be mechanistically related to suspended animation. Furthermore, we show that neuronal HIF-1 activity in the adult dictates the O(2) tension at which embryonic diapause is engaged. We suggest that the maternal perception of hypoxia stimulates a response to protect embryos in utero by inducing diapause, a natural form of suspended animation. This response is likely to be an important strategy to improve offspring survival in harsh conditions and allow adults to find environments more suitable for reproductive success.