The maternal diabetic environment alters the embryo and the feto-placental development. The results of these alterations are: increased embryo resorption and malformation rates, placental dysfunction, fetal alterations that lead to increased neonatal morbidity and mortality rates, and also diseases that will be evident later in the adult life of the newborn. The etiology of these many maternal diabetes-induced complications are not yet understood in full. In this review the role of maternal diabetes as an inductor of a pro-inflammatory environment that impairs embryo and placental development is discussed. An overproduction of proinflammatory agents is found in the uterus during implantation and the developing embryo and placenta from experimental models of diabetes, as well as in placenta from diabetic women. In these tissues there are increases in reactive oxygen species, pro-inflammatory cytokines and prostaglandins, nitric oxide and peroxynitrites. These pro-inflammatory agents lead to the intrauterine activation of matrix metalloproteinases, proteases involved in remodeling the extracellular matrix during implantation and feto-placental development. Many of these pro-inflammatory agents have overlapping mechanisms of action and cross regulatory pathways that propagate the inflammatory processes. Antioxidants, PPARγ activators, and NF-κB inhibitors are able to reduce the concentrations of these agents in intrauterine gestational tissues. This article reviews the current understanding of maternal diabetes-induced changes in pro-inflammatory and anti-inflammatory pathways that affect the embryo and placental development in maternal diabetes, and stresses the need of a strict maternal control of the pathology to prevent deleterious consequences in the offspring.