To determine whether damage to the fetal kidneys plays a role in the formation of hydrops fetalis following a severe asphyxial episode, six chronically catheterised fetal sheep, at 0.6 gestation (90 days; term 150 days), were subjected to 30 min of complete umbilical cord occlusion. During the occlusion period, mean arterial pressure, heart rate and renal blood flow decreased (P < 0.001). There were falls in arterial pH and PO2 and a rise in PCO2 (P < 0.001). Urine flow rate decreased (P < 0.005), as did the excretion rates of sodium and osmoles (P < 0.05). However, by 60 min after release of occlusion, urine flow rate was similar to control values. By the end of day 1, most renal variables returned to normal. At post-mortem, 72 h after occlusion, all asphyxiated fetuses showed gross signs of hydrops. Body weight was higher (P < 0.05) due to fluid accumulation in the peritoneal (P < 0.001) and pleural cavities (P < 0.05) as well as subcutaneously (P < 0.05). Amniotic/allantoic fluid volume was increased (P < 0.05). Kidney histology was normal except for clusters of apoptotic cells in some proximal tubules. In conclusion, this severe asphyxial episode caused surprisingly little damage to the kidney and the changes in renal function were very transient. Thus renal damage was not important in the development of hydrops. Possibly, the midgestation fetal kidney has a limited capacity to increase urinary salt and water excretion in response to increased fluid delivery across the placenta.