Oxidative stress and inflammatory insults are the major instigating events of bacterial intrauterine infection that lead to fetal brain injury. The purpose of this study is to investigate the remedial effects of N-acetyl-cysteine (NAC) for inflammation-caused deficits in brain development. We found that lipopolysaccharide (LPS) induced reactive oxygen species (ROS) production by RAW264.7 cells. Macrophage-conditioned medium caused noticeable cortical cell damage, specifically in cortical neurons. LPS at 25 μg/kg caused more than 75% fetal loss in rats. An increase in fetal cortical thickness was noted in the LPS-treated group. In the enlarged fetal cortex, laminar positioning of the early born cortical cells expressing Tbr1 and Ctip2 was disrupted, with a scattered distribution. The effect was similar, but minor, in later born Satb2-expressing cortical cells. NAC protected against LPS-induced neuron toxicity in vitro and counteracted pregnancy loss and alterations in thickness and lamination of the neocortex in vivo. Fetal loss and abnormal fetal brain development were due to LPS-induced ROS production. NAC is an effective protective agent against LPS-induced damage. This finding highlights the key therapeutic impact of NAC in LPS-caused abnormal neuronal laminar distribution during brain development.