Since its conception, prenatal therapy has been successful in correction of mainly anatomical defects, though the range of application has been limited. Research into minimally invasive fetal surgery techniques and prenatal molecular diagnostics has facilitated the development of in utero stem cell transplantation (IUT) - a method of delivering healthy stem cells to the early-gestation fetus with the hope of engraftment, proliferation and migration to the appropriate haematopoietic compartment. An area of application which shows promise is the treatment of hematopoietic disorders like hemoglobinopathies. The therapeutic rationale of IUT with hematopoietic stem cells (HSC) is based on the proposed advantages the fetal environment offers based on its unique physiology. These advantages include the immature immune system facilitating the development of donor-specific tolerance, the natural migration of endogenous hematopoietic cells providing space for homing and engraftment of donor cells, and the fetal environment providing hematopoietic stem cells with the same opportunity to survive and proliferate regardless of their origin (donor or host). Maternal immune tolerance to the fetus and placenta also implies that the maternal environment could be accepting of donor cells. In theory, the fetus is a perfect recipient for stem cell transplant. Clinically, however, IUT is yet to see widespread success calling into question these assumptions of fetal physiology. This review aims to discuss and evaluate research surrounding these key assumptions and the clinical success of IUT in the treatment of thalassemia.