Objective: Investigate marked variability in fetal heart rate (FHR) patterns before delivery and its association with neonatal morbidity and abnormal arterial cord gases. Study design: Prospective cohort of laboring patients at term. Composite neonatal morbidity (respiratory distress, mechanical ventilation, suspected sepsis, meconium aspiration syndrome, therapeutic hypothermia, hypoxic-ischemic encephalopathy, seizure, and death) and abnormal arterial cord gases (pH < 7.10, lactate ≥ 4 mmol/L, base deficit < −12 mEq/L) were assessed with multivariable logistic regression. Result: Three hundred and ninety (4.5%) neonates had marked variability in FHR patterns before delivery. There was no difference in composite neonatal morbidity (aRR 1.22; 95% CI 0.91–1.63), though neonates with marked variability in FHR patterns were more likely to have a respiratory distress (aRR 1.85; 95% CI 1.25–2.70). There was an increased risk of composite abnormal arterial cord gases (aRR 1.66; 95% CI 1.47–1.88). Conclusion: Marked variability in FHR patterns was not associated with composite neonatal morbidity but was associated with abnormal arterial cord gases.