Hypoxic-ischemic (HI) brain injury in newborns is associated with high morbidity and mortality, with many babies suffering neurological deficits. Recently, we showed that hypoxic postconditioning (PostC) immediately post injury can protect against HI up to one week in neonatal rats. Here, we aimed to examine whether long term functional deficits were also improved by PostC. Sprague-Dawley rats were assigned to control (C) or HI group on postnatal day 7 (P7). The HI group underwent unilateral carotid artery occlusion followed by hypoxia (7% oxygen, 3 h). Half of each group were randomly assigned to the PostC group (8% oxygen, 1 h/day for 5 days post-injury), or normoxic group, where animals were kept under ambient conditions. Righting reflex and negative geotaxis tests were performed on P8 and P14. On P42, rats underwent further behavioural tests of motor function and memory (forelimb grip strength, grid walking and novel object recognition tasks). Brain injury was assessed using histological scoring of brain sections. At P14, PostC reduced the righting reflex deficit compared to HI alone. Long-term (6 weeks) behavioural deficits were observed in grid walking and novel object recognition tests after HI alone, with both functions improved following PostC. Following HI, there was an increase in brain injury assessed by histological scoring compared to control, and this damage was reduced by PostC. This novel finding of long-term histological neuroprotection accompanied by functional improvements by PostC further demonstrates the clinical potential of mild hypoxia for the treatment of HI brain injury.