Many viruses are detrimental to pregnancy and negatively affect fetal growth and development. What is not well understood is how virus-induced inflammation impacts fetal-placental growth and developmental trajectories, particularly when inflammation occurs in early pregnancy during nascent placental and embryo development. To address this issue, we simulated a systemic virus exposure in early pregnant rats (gestational day 8.5) by administering the viral dsRNA mimic polyinosinic:polycytidylic acid (PolyI:C). Maternal exposure to PolyI:C induced a potent antiviral response and hypoxia in the early pregnant uterus, containing the primordial placenta and embryo. Maternal PolyI:C exposure was associated with decreased expression of the maternally imprinted genes Mest, Sfrp2, and Dlk1, which encode proteins critical for placental growth. Exposure of pregnant dams to PolyI:C during early pregnancy reduced fetal growth trajectories throughout gestation, concomitant with smaller placentas, and altered placental structure at midgestation. No detectable changes in placental hemodynamics were observed, as determined by ultrasound biomicroscopy. An antiviral response was not evident in rat trophoblast stem (TS) cells following exposure to PolyI:C, or to certain PolyI:C-induced cytokines including IL-6. However, TS cells expressed high levels of type I IFNR subunits (Ifnar1 and Ifnar2) and responded to IFN-α by increasing expression of IFN-stimulated genes and decreasing expression of genes associated with the TS stem state, including Mest. IFN-α also impaired the differentiation capacity of TS cells. These results suggest that an antiviral inflammatory response in the conceptus during early pregnancy impacts TS cell developmental potential and causes latent placental development and reduced fetal growth.