Several cases of systemic arteriovenous fistula diagnosed in the human fetus have been associated with the postnatal development of persistent pulmonary hypertension. The aim of this study was to determine the effects of a sytemic arteriovenous fistula created prenatally on the structure and reactivity of the pulmonary circulation in the fetal lamb. A fistula between jugular vein and carotid artery was created in fetal lambs at 119-124 days of gestation. At delivery (134-139 days), left pulmonary artery (LPA) pressure was increased in the fistula group (n = 12) as compared with controls (n = 11) (P < 0.01). The pulmonary vascular resistance was significantly higher in the fistula group (P < 0.05) while mean LPA blood flow were not statistically different between the 2 groups. Morphometric analysis of the pulmonary vascular bed revealed an increase in the number of peripheral muscular arteries together with an increase in pulmonary arterial medial thickness in the fistula group. There was no difference in the relative number or size of intraacinar arteries. In vitro organ bath studies on pulmonary arterial rings showed impaired endothelium-dependent relaxation in the fistula group compared with controls. However, eNOS protein expression was similar in both groups, whilst endothelium-independent relaxation to sodium nitroprusside was greater in the fistula group as compared with controls. A systemic arteriovenous fistula leads to both structural and functional alteration of the pulmonary vasculature, which might lead to the development of persistent pulmonary hypertension after birth.