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The control of foetal growth is poorly understood and yet it is critically important that at birth the body has attained appropriate size and proportions. Growth and survival of the mammalian foetus is dependent upon a functional placenta throughout most of gestation. A few genes are known that influence both foetal and placental growth and might therefore coordinate growth of the conceptus, including the imprinted Igf2 and Grb10 genes. Grb10 encodes a signalling adapter protein, is expressed predominantly from the maternally-inherited allele and acts to restrict foetal and placental growth. Here, we show that following disruption of the maternal allele in mice, the labyrinthine volume was increased in a manner consistent with a cell-autonomous function of Grb10 and the enlarged placenta was more efficient in supporting foetal growth. Thus, Grb10 is the first example of a gene that acts to limit placental size and efficiency. In addition. we found that females inheriting a mutant Grb10 allele from their mother had larger litters and smaller offspring than those inheriting a mutant allele from their father. This grandparental effect suggests Grb10 can influence reproductive strategy through the allocation of maternal resources such that offspring number is offset against size.