Unexplained intrauterine growth restriction of the fetus (IUGR) results from impaired placental development, frequently associated with maternal malperfusion. Some cases are complicated further by preeclampsia (PE+IUGR). Here, we provide the first evidence that placental protein synthesis inhibition and endoplasmic reticulum (ER) stress play key roles in IUGR pathophysiology. Increased phosphorylation of eukaryotic initiation factor 2alpha suggests suppression of translation initiation in IUGR placentas, with a further increase in PE+IUGR cases. Consequently, AKT levels were reduced at the protein, but not mRNA, level. Additionally, levels of other proteins in the AKT-mammalian target of rapamycin pathway were decreased, and there was associated dephosphorylation of 4E-binding protein 1 and activation of glycogen synthase kinase 3beta. Cyclin D1 and the eukaryotic initiation factor 2B epsilon subunit were also down-regulated, providing additional evidence for this placental phenotype. The central role of AKT signaling in placental growth regulation was confirmed in Akt1 null mice, which display IUGR. In addition, we demonstrated ultrastructural and molecular evidence of ER stress in human IUGR and PE+IUGR placentas, providing a potential mechanism for eukaryotic initiation factor 2alpha phosphorylation. In confirmation, induction of low-grade ER stress in trophoblast-like cell lines reduced cellular proliferation. PE+IUGR placentas showed elevated ER stress with the additional expression of the pro-apoptotic protein C/EBP-homologous protein/growth arrest and DNA damage 153. These findings may account for the increased microparticulate placental debris in the maternal circulation of these cases, leading to endothelial cell activation and impairing placental development.