Perinatal hypoxic-ischemic encephalopathy (HIE) is an important cause of brain injury in the newborn. It may lead to a variety of different long-term neurological sequelaes; from mild behavioral deficits to severe compromise with seizures, mental retardation and cerebral palsy (CP). The purpose of the present thesis is to provide an overview of the fetal physiological responses to acute perinatal hypoxia and the pathophysiological mechanisms behind the development of HIE. Different terms related to this condition will also be discussed, as well as normal fetal physiology and methods of fetal surveillance during labor. Finally will future challenges and possible strategies for preventing HIE be suggested. The information presented in this paper is a summary of current knowledge, and has primarily been obtained by searches in medical databases for relevant reviews and articles. A thorough insight into the normal physiology of the fetus and the process of labor, as well as knowledge of the possible pathophysiological mechanisms involved, are crucial for understanding how HIE may arise. It also forms the basis for understanding and interpreting the fetal heart rate monitoring and other modes of surveillances used to detect endangered fetuses during labor. Through this we may improve the individual management of every labor and thereby reduce the risk of development of birth asphyxia and possible fetal injury.