Neonatal encephalopathy is a common central nervous system disorder of neonatal foals and human infants, resulting in clinical signs such as lethargy, inappropriate behavior, seizures, and other neurologic deficits. Although neonatal encephalopathy is frequently seen in equine practice, a paucity of veterinary clinical and basic science research data is available. Therefore, the pathophysiologic mechanisms of this disorder in equids, such as energy deprivation, excess excitatory amino acids, and free radical injury, have been extrapolated from human medicine. Equine veterinarians have used various diagnostic and therapeutic regimens from human medicine with reasonable success in equine patients. Understanding the potential pathophysiologic mechanisms involved in neonatal encephalopathy can facilitate management of affected foals.