An IUD is thought to exert a contraceptive effect either by (1) inducing the premature expulsion of embryos, (2) preventing the uterus from accepting the embryo for implantation, or (3) causing the death of the unimplanted embryo. The intrauterine environment of rats with an IUD was tested for embryotoxic effects on embryos introduced into the uterus, using the technique of double transfer of embryos. Exposure of embryos to an IUD-bearing uterus for 2½ to 4 hr resulted in failure to recover 85% of them. Even the few embryos recovered after 2½ to 4 hr showed greatly increased mortality when transplanted into a normal pseudopregnant recipient. Removing the IUD 6, 24, 48 or 72 hr before embryo transfer increased both the recovery and survival rates over those obtained with the IUD in situ. The recovery rates were not equal to those from the controls, however, until 72 hr elapsed between IUD removal and embryo transfer. Embryos were transferred into the IUD-bearing horn of bilaterally ovariectomized rats treated with progesterone. The recovery rate of these embryos was intermediate between that of intact controls and non-ovariectomized, IUD-bearing animals. The survival rate of these embryos, however, was higher than that of the controls. The results of the embryo transfer experiments indicate that an IUD inhibits pregnancy in the rat by directly causing the death of embryos within 4 hr.