Previous research has identified an association between malpractice liability risk levels in a state and greater use of cesarean sections in obstetrical care. However, it is unclear whether such practice changes are associated with better birth outcomes. Using a mixed-effects model, we investigate the impact of malpractice risk, as measured by malpractice insurance premiums and various state tort reforms, on four adverse birth outcomes. We use a longitudinal research design to examine millions of individual births from 51 jurisdictions over 12 years (1991–2002). We find that the odds of adverse birth outcomes are not associated with premium levels or tort reforms. Our results suggest that rather than having a socially desirable deterrent effect on substandard care, liability pressure may produce a level of precaution taking in obstetrics that is higher than socially optimal. By the same token, the results also suggest that the adoption of liability-limiting reforms is unlikely to have an adverse impact on outcomes.