Although lipid metabolism in fetal livers under intrauterine growth restriction (IUGR) conditions has been widely studied, the implications of maternal undernutrition on fetal hepatic lipid metabolism, lipotoxic injury, and abnormal development remain largely unknown. Therefore, this study investigated the effects of maternal undernutrition on disordered hepatic lipid metabolism, lipotoxic injury, and abnormal development in IUGR sheep fetuses using transcriptome analysis. Seventeen singleton ewes were randomly divided into three groups on day 90 of pregnancy: a control group (CG; 0.63 MJ metabolic energy/body weight (ME/BW)0.75/day, n = 5), maternal undernutrition group 1 (MU1; 0.33 MJ ME/BW0.75/day, n = 6), and maternal undernutrition group 2 (MU2; 0.20 MJ ME/BW0.75/day, n = 6). The fetuses were euthanized and recovered on day 130 of pregnancy. The levels of free fatty acids (FFA) in maternal blood (P < 0.01), fetal blood (P < 0.01), and fetal livers (P < 0.05) were increased in the MU1 and MU2 groups, but fetal hepatic triglyceride (TG) levels in the MU2 group (P < 0.01) and β-hydroxybutyrate levels in the MU1 and MU2 groups (P < 0.01) were decreased compared to the CG. Severe inflammatory cell infiltration and increased non-alcoholic fatty liver disease activity scores were observed in MU1 and MU2 fetuses (P < 0.01). Progressive deposition of fetal hepatic reticular fibers and collagen fibers in the fetal livers of the MU1 and MU2 groups and significant hepatic fibrosis were observed in the MU2 fetuses (P < 0.05). Gene set enrichment analysis showed that genes involved in lipid accumulation and FFA beta oxidation were downregulated in both MU groups compared to those in the controls. The fetal liver mRNA expression of the β-oxidation regulator, acetyl-CoA acetyltransferase 1, and the TCA regulator, isocitrate dehydrogenase were reduced in MU1 (P < 0.05) and MU2 (P < 0.01) fetuses, and downregulated mRNA expression of long chain fatty acid CoA ligase 1 (P < 0.05) and glycerol-3-phosphate acyltransferase (P < 0.01) was observed in MU2 fetuses. Differentially expressed genes (DEGs) in MU1 versus CG (360 DEGs) and MU2 versus CG (746 DEGs) were identified using RNA sequencing. Bioinformatics analyses of the 231 intersecting DEGs between MU1 versus CG and MU2 versus CG indicated that neutrophil extracellular traps (NETs) were induced and played a central role in fetal hepatic injury in IUGR sheep. Increased maternal blood myeloperoxidase (MPO) levels (P < 0.01), NE (Elane)-positive areas in fetal liver sections (P < 0.05), and fetal liver MPO protein expression (P < 0.01) were found in the MU1 and MU2 groups; however, MPO levels were reduced in the fetal membrane (P < 0.01) and fetal blood (P < 0.05) in the MU1 group, and in the maternal-fetal placenta and fetal blood in the MU2 group (P < 0.01). Analysis of gene expression trends in the intersecting DEGs between MU1 versus CG (129 DEGs) and MU2 versus CG (515 DEGs) further revealed that 30 hub genes were essential regulators of the G2/M cell cycle, all of which were associated with hepatocellular carcinoma. G0/G1 phase cells of the fetal liver were reduced in the MU1 (P < 0.05) and MU2 (P < 0.01) groups, whereas G2/M phase cells were elevated in the MU1 and MU2 groups (P < 0.01). The representatives of upregulated hub genes and fetal liver protein expression of maternal embryonic leucine zipper kinase and protein regulator of cytokinesis 1 were progressively enhanced in the MU1 and MU2 groups (P < 0.01), and topoisomerase II alpha protein expression in the MU2 group (P < 0.05), as expected. These results indicate that FFA overload, severe lipotoxic injury, and NETs were induced, and disease-promoting regulators of the G2/M cell cycle were upregulated in the fetal liver of IUGR sheep. These findings provide new insights into the pathogenesis of impaired hepatic lipid metabolism and abnormal development and the molecular origin of post-natal liver disease in IUGR due to maternal undernutrition. This information can support the development of new therapeutic strategies.