Sleep–wake disturbances and stress hyper-responsiveness have been observed in human neonates, children and adolescents who were exposed to alcohol during the prenatal period. Using the laboratory rat as an animal model, we investigated whether fetal ethanol exposure during gestational days 10–21 affects the circadian function of the stress-axis regulatory β-endorphin neurons in the hypothalamus. Fetal ethanol-exposed rats showed abnormality in the circadian expression of proopiomelanocortin (POMC) mRNA encoding the peptide β-endorphin in the arcuate nucleus of the hypothalamus during the adult period. These rats also showed altered circadian expression of the clock governing Period genes rPer1, rPer2 and rPer3, in the arcuate nucleus, and rPer1 and rPer 2 mRNA levels in the suprachiasmatic nucleus. Laser captured microdissection analysis identified constitutive expression of rPer1, rPer2 and rPer3 genes in β-endorphin-containing neurons. These data suggest for the first time that fetal exposure to ethanol significantly alters the clock mechanisms governing the circadian function of β-endorphin neurons.