Objectives To assess the effect of timing of folic acid (FA) supplementation during pregnancy on the risk of the neonate being small for gestational age (SGA). Design A population database study and a systematic review with meta‐analysis including the results of this population study. Setting and data sources A UK regional database was used for the population study and an electronic literature search (from inception until August 2013) for the systematic review. Participants and included studies Singleton live births with no known congenital anomalies; 111 736 in population study and 188 796 in systematic review. Outcome measures, data extraction and analysis The main outcome was SGA based on customised birthweight centile. Associations are presented as odds ratios (OR) and adjusted odds ratios (aOR), adjusted for maternal and pregnancy‐related characteristics. Results Of 108 525 pregnancies with information about FA supplementation, 92 133 (84.9%) had taken FA during pregnancy. Time of commencement of supplementation was recorded in 39 416 pregnancies, of which FA was commenced before conception in 10 036, (25.5%) cases. Preconception commencement of FA supplementation was associated with reduced risk of SGA <10th centile (aOR 0.80, 95% CI 0.71–0.90, P < 0.01) and SGA <5th centile (aOR 0.78, 95% CI 0.66–0.91, P < 0.01). This result was reproduced when the data were pooled with other studies in the systematic review, showing a significant reduction in SGA (<5th centile) births with preconception commencement of FA (aOR 0.75, 95% CI 0.61–0.92, P < 0.006). In contrast, postconception folate had no significant effect on SGA rates. Conclusion Supplementation with FA significantly reduces the risk of SGA at birth but only if commenced preconceptually independent of other risk factors. Systematic review registration This systematic review was prospectively registered with PROSPERO number CRD42013004895.