A conical silicone rubber balloon was placed in the left hemithorax of fetal lambs and progressively inflated through an exteriorized catheter over the last trimester. Newborn lambs died of severe respiratory insufficiency, despite maximal resuscitation. The lungs were markedly hypoplastic with greatly reduced parenchymal mass and air capacity. This model of a progressively enlarging intrathoracic mass which produces severe pulmonary hypoplasia and fatal respiratory insufficiency simulates the pathophysiology of congenital diaphragmatic hernia in human neonates.