Moloney murine leukemia virus is efficiently transmitted from viremic mothers to offspring, primarily via virus-containing milk. To determine the level in the infectious process at which an antiviral agent can interfere most effectively with perinatal viral transmission, we examined the effect of the drug 3'-azido-3'-deoxythymidine (AZT) on transmission of Moloney murine leukemia virus from viremic mothers to offspring. Although AZT treatment did not affect the titer of virus in milk, it did suppress the development of viremia in all offspring. AZT, however, did not prevent transmission of virus from viremic mothers to 25% of the offspring, but did lead to a marked reduction in virus load in these infected mice. These results provide evidence for effective antiretroviral therapy during gestation and in the perinatal period and are of potential significance for the management of maternal transmission of human retroviruses.