Foetal growth restriction (FGR), reflective of an adverse intrauterine environment, confers a significantly increased risk of perinatal mortality and morbidity. In addition, low birthweight associates with adult diseases including hypertension, metabolic dysfunction and behavioural disorders. A key mechanism underlying FGR is exposure of the foetus to glucocorticoids which, while critical for foetal development, in excess can reduce foetal growth and permanently alter organ structure and function, predisposing to disease in later life. Foetal glucocorticoid exposure is regulated, at least in part, by the enzyme 11β-hydroxysteroid dehydrogenase type 2 (11β-HSD2), which catalyses the intracellular inactivation of glucocorticoids. This enzyme is highly expressed within the placenta at the maternal-foetal interface, limiting the passage of glucocorticoids to the foetus. Expression of 11β-HSD2 is also high in foetal tissues, particularly within the developing central nervous system. Down-regulation or genetic deficiency of placental 11β-HSD2 is associated with significant reductions in foetal growth and birth weight, and programmed outcomes in adulthood. To unravel the direct significance of 11β-HSD2 for developmental programming, placental function, neurodevelopment and adult behaviour have been extensively investigated in a mouse knockout of 11β-HSD2. This review highlights the evidence obtained from this mouse model for a critical role of feto-placental 11β-HSD2 in determining the adverse programming outcomes. © 2013 Scandinavian Physiological Society.