The fetus, which develops within a fluid-filled amniotic sac, relies on the placenta for respiratory gas exchange rather than the lungs. While not involved in fetal oxygenation, fetal breathing movements (FBM) nevertheless have an important role in lung growth and in development of respiratory muscles and neural regulation. FBM are regulated differently in many respects than postnatal respiration, which results from the unique intrauterine environment. Prominent distinctions of FBM include its episodic nature and apnea-sensitivity to hypoxia. The latter characteristic is the basis for using FBM in the assessment of fetuses at risk for hypoxic injury. At birth, the transition to continuous postnatal respiration involves a fall in temperature, gaseous distention of the lungs, activation of the Hering-Breuer reflexes, and functional connectivity of afferent O2 chemoreceptor activity with respiratory motoneurons and arousal centers. Importantly, exposure to drugs or adverse conditions in utero not only can change patterns of FBM but also can lead to epigenetic dysregulation in postnatal respiration. Such changes, can blunt respiratory and arousal defenses against hypoxic challenges in sleep. Thus, fetal hypoxia and/or drug exposure may in later life dispose sleeping infants, children, and adults to hypertension, diabetes mellitus, brain injury, and sudden death.