Pregnancy establishment implies the existence of a highly vascularized and transient organ, the placenta, which ensures oxygen supply to the fetus via haemoproteins. Haem metabolism, including its catabolism by haem oxygenase‐1 (HO‐1), should be of importance in maintaining the homeostasis of haemoproteins and controlling the deleterious effects associated with haem release from maternal or fetal haemoglobins, thus ensuring placental function and fetal development. We demonstrate that HO‐1 expression is essential to promote placental function and fetal development, thus determining the success of pregnancy. Hmox1 deletion in mice has pathological consequences for pregnancy, namely suboptimal placentation followed by intrauterine fetal growth restriction (IUGR) and fetal lethality. These pathological effects can be mimicked by administration of exogenous haem in wild‐type mice. Fetal and maternal HO‐1 is required to prevent post‐implantation fetal loss through a mechanism that acts independently of maternal adaptive immunity and hormones. The protective HO‐1 effects on placentation and fetal growth can be mimicked by the exogenous administration of carbon monoxide (CO), a product of haem catabolism by HO‐1 that restores placentation and fetal growth. In a clinical relevant model of IUGR, CO reduces the levels of free haem in circulation and prevents fetal death. We unravel a novel physiological role for HO‐1/CO in sustaining pregnancy which aids in understanding the biology of pregnancy and reveals a promising therapeutic application in the treatment of pregnancy pathologies. Copyright © 2011 Pathological Society of Great Britain and Ireland. Published by John Wiley & Sons, Ltd.