Inflammation is a defensive process by which the body responds to both localized and systemic tissue damage by the induction of innate and adaptive immunity. Literature from human and animal studies links inappropriate in utero inflammation to preterm parturition and fetal injury. The pathways by which such inflammation may cause labor, however, are not fully understood. Any proinflammatory agonist in the amniotic fluid will contact the fetal skin, in its entirety, but a potential role of the fetal skin in the pathways to labor have not previously been explored. We hypothesized that the fetal skin would respond robustly to the presence of intra-amniotic lipopolysaccharide (LPS) in our ovine model of in utero inflammation. In vitro and in utero exposure of fetal ovine keratinocytes or fetal skin to Escherichia coli LPS reliably induced significant increases in interleukin 1β (IL-1β), IL-6, tumor necrosis factor α (TNF-α), and IL-8 expression. We demonstrate that, in utero, this expression requires direct exposure with LPS suggesting that the inflammation is triggered directly in the skin itself, rather than as a secondary response to a systemic stimuli and that inflammation involves Toll-like receptor (TLR) regulation and neutrophil chemotaxis in concordance with an acute inflammatory reaction. We show that this response involves multiple inflammatory mediators, TLR regulation, and localized inflammatory cell influx characteristic of an acute inflammatory reaction. These novel data strongly suggests that the fetal skin acts as an important mediator of the fetal inflammatory response and as such may contribute to preterm birth.