Palmistichus elaeisis Delvare and LaSalle 1993 (Hymenoptera: Eulophidae) and neem oil are two control alternatives for the integrated management of defoliating lepidopterans. The aim of this study was to evaluate the acute and chronic toxicity of neem oil compared to the synthetic insecticide deltamethrin, on the endoparasitoid P. elaeisis, in generations F0, F1, F2, and F3. Females of P. elaeisis were exposed to neem solutions at concentrations of 0, 1.87, 3.75, 7.50, 15.00, 30.00, and 60.00 mg ml^–1, to determine the dose-response relationship and estimate the neem LC₅₀. The sublethal effects on the parasitoid P. elaeisis in generations F0 to F3 were evaluated with these same concentrations of neem and 0.033 mg ml^–1 of deltamethrin. The neem LC₅₀ was estimated at 3.92 mg ml^–1. The LC₅₀ for P. elaeisis is 3.83 times lower than that recommended by the neem manufacturer for pest control, demonstrating high acute toxicity to this natural enemy. The chronic toxicity of both the commercial dose and those below it to P. elaeisis caused low sublethal effects. The correct concentration of neem oil in pest control is important, and its use should be performed with caution in integrated pest management programs using the endoparasitoid P. elaeisis to avoid causing interference between the two pest control techniques.