Inositol requiring enzyme-1 (IRE1), a protein located on the endoplasmic reticulum (ER) membrane, is highly conserved from yeast to humans. This protein is activated during ER stress and induces cellular adaptive responses to the stress. In mice, IRE1α inactivation results in widespread developmental defects, leading to embryonic death after 12.5 days of gestation. However, the cause of this embryonic lethality is not fully understood. Here, by using in vivo imaging analysis and conventional knockout mice, respectively, we showed that IRE1α was activated predominantly in the placenta and that loss of IRE1α led to reduction in vascular endothelial growth factor-A and severe dysfunction of the labyrinth in the placenta, a highly developed tissue of blood vessels. We also used a conditional knockout strategy to demonstrate that IRE1α-deficient embryos supplied with functionally normal placentas can be born alive. Fetal liver hypoplasia thought to be responsible for the embryonic lethality of IRE1α-null mice was virtually absent in rescued IRE1α-null pups. These findings reveal that IRE1α plays an essential function in extraembryonic tissues and highlight the relationship of physiological ER stress and angiogenesis in the placenta during pregnancy in mammals.