To evaluate how assisted reproductive technologies (ART) affect vasculogenesis of the developing conceptus, we analyzed placental and fetal development of in vitro-produced (IVP) sheep embryos. Pregnancies produced by ART carry increased risk of low birth weight, though what causes this risk remains largely unknown. We recently reported that developmental arrest of sheep conceptuses obtained by ART is most pronounced when the cardiovascular system develops (Days 20–30 of development). A total of 86 IVP blastocysts (2–4 per ewe) were surgically transferred to 30 recipient sheep 6 days after estrus; 20 sheep were naturally mated (control). Conceptuses were recovered from sheep at Days 20, 22, 26, and 30 of gestation and morphologically evaluated. Then, the conceptuses and part of their placentae (chorion-allantois) were fixed for histological and immunohistochemical analysis and snap-frozen in liquid nitrogen for subsequent mRNA expression analysis. Results demonstrate that the cardiovascular systems of sheep IVP conceptuses were severely underdeveloped. Pericardial and placental hemorrhages were noted in a majority (5/7) of the dead embryos. In the surviving IVP embryos, the expression of angiogenetic factors was reduced at Day 20. The placental vessels were underdeveloped on Days 20 and 22 (P < 0.05), though placental vasculogenesis was successfully completed on subsequent days. However, low vessel number persisted at Days 26 and 30 (4.6 vs. 5.9 and 6.64 vs. 8.70 per field, respectively; P < 0.05) together with reduced vessel diameter at Day 26 (46.89 vs. 89.92 μm; P < 0.05). In vitro production of sheep embryos induced severely impaired vasculogenesis early in gestation. This may lead to developmental programing problems, such as intrauterine growth restriction of the fetus, resulting in long-term health consequences for the offspring, such as cardiovascular diseases.