Prolactin family 7, subfamily d, member 1 (Prl7d1), a member of the expanding prolactin family, is mainly expressed in the placental junctional zone (including trophoblast giant cells and spongiotrophoblast cells) with peak expression observed at 12 days postcoitum (dpc) in mice. Previous studies have shown that PRL7D1 is a key mediator of angiogenesis in vitro; however, its physiological roles in placental development in vivo have not been characterized. To address this issue, we deleted Prl7d1 in mice and demonstrated that its absence results in reduced litter size and fertility. Histologically, Prl7d1 mutants exhibited striking placental abnormalities at 12.5 dpc, including a reduction in the proportion of labyrinth layers and a significant increase in decidual natural killer cells, glycogen trophoblasts, and trophoblast giant cells in the junctional zone. Moreover, placentas from Prl7d1‐null mice displayed a thickened decidual spiral artery. Notably, these negative effects were more pronounced in male fetuses. Further RNA‐sequencing analysis showed that Prl7d1 deletion results in significant differences in the placental transcriptome profile between the two sexes of fetuses. Together, this study demonstrates that Prl7d1 possesses antiangiogenic properties in deciduas and inhibits the development of junctional zone, which potentially alters the functional capacity of the placenta to support optimal fetal growth. Moreover, of note, the role of Prl7d1 in the placenta is regulated in a fetal sex‐specific manner.