The fetoplacental unit has three important functions: (i) a source of protein and steroid hormones, which are delivered to the maternal circulation; (ii) a selective barrier that determines the nature of the communication and interaction between the maternal and fetal endocrinological and physiological systems; and (iii) a participant in the control of fetal growth, development, endocrine function, and parturition (birth). In all these functions, the fetus and maternal placenta have separate circulatory systems which, as shown in Figure 1, exchange nutrients, gases, and waste products in the blood pools of the maternal portion of the placenta. To accomplish this, blood poor in oxygen and nutrients leaves the fetus through the umbilical arteries and enters the capillaries of the chorionic villus. In these capillaries, blood is oxygenated by, gains nutrients from, and gives up wastes to the maternal blood in the pools before it returns to the fetus in the umbilical vein. Oxygen-depleted blood leaves the maternal blood pool through the maternal veins. Thus, from the time blood flow is established at 3 weeks following fertilization, fetal oxygenated blood is carried by veins rather than arteries (and oxygen-poor blood by arteries rather than veins), a reversal from the situation after birth when the neonatal circulatory system becomes functional.

Fig1. Fetal-maternal circulation in the placenta. The transfer of gasses, nutrients, waste products, and other molecules between the maternal and fetal circulation takes place in the maternal blood pools which have arisen from the spiral arteries of the endometrium. Freshly oxygenated blood from the mother enters the pools through the maternal arteries (left side, red). Blood that is poor in oxygen and nutrients leaves the fetus through the umbilical arteries (right side, blue), enters the capillaries of the chorionic villus where it is oxygenated and gains nutrients before it returns to the fetus in the umbilical vein (right side, red). Oxygen-depleted blood leaves the maternal blood pool through the maternal veins (left side, blue). Note that in fetal life, the situation is reversed from that after birth, when oxygenated blood is carried by the arteries.
Following implantation, the trophoblast rapidly proliferates new chorionic villi which infiltrate the endometrial decidua and become the chorion fondosum, the fetal portion of the placenta as shown in Figure 2. The portion of the placenta adjacent to the choionic fondosum, the decidua basalis, constitutes the maternal portion of the placenta. The fetus, in the amniotic sac, actually lies within the uterine wall. As the fetus grows, the amnion eventually fuses with the chorion as the fetus in the amniotic sac fills the uterine cavity. The villous surface area continues to grow throughout gestation, but the growth rate falls off at 36–38 weeks. By this time the placenta is a disk 15–20 cm in diameter and weighs 500–600 g; the umbilical cord is about 55 cm long.

Fig2. Development of the placenta. By the end of four months, the placenta is anatomically complete. The fetal portion of the placenta, where fetal blood exchanges gases and molecules with maternal blood, is the chorion fondosum (blue, right side). The portion of the decidua which lies near the chorion fondosum, the decidua basalis, is the maternal portion of the placenta (orange, right side). Here the amniotic membrane is shown separately, but as the fetus and placenta continue to gain in size, the amniotic and chorionic membranes fuse to surround the amniotic cavity. Note that the fetus lies within the uterine wall, not outside it in the uterine cavity (brown).