The embryologic development of the capsular ligaments, synovial lining, rotator cuff, and bony structures of the shoulder is incompletely understood. The purpose of this study is to report the gross and microscopic anatomy of the developing glenohumeral joint on the basis of dissections of fetal shoulder specimens. After Institutional Review Board approval from our hospital, 51 shoulders in 37 fetal specimens were obtained from cases of fetal demise. The gestation time of these specimens ranged from 9 to 40 weeks. The morphology of the capsule, labrum, and associated ligaments were studied by dissection under a dissecting microscope. High-resolution radiographs were made, and sections were processed for routine histology. There was noted to be minimal variation in the shape and slope of the acromion. The coracoid was much larger in relation to the shoulder than in the mature shoulder. The coracoacromial ligament was grossly evident at this stage of development, with distinct anterolateral and posteromedial bands in this ligament. The inferior glenohumeral ligament was seen as a prominent thickening in the capsule, whereas the middle and superior glenohumeral ligaments were thinner and more difficult to identify as distinct structures. Upon histologic examination, the inferior glenohumeral ligament was seen to consist of several layers of organized collagen fibers. The inferior glenohumeral ligament inserted into the labrum and margin of the glenoid. The capsule was much thinner in the region superior to the inferior glenohumeral ligament. A rotator interval capsular defect was often present, and the coracohumeral ligament was seen as a distinct structure as early as 15 weeks. A bare spot in the glenoid was not observed. This study indicates that some of the important functional elements of the structure of the mature human shoulder are present early in development, including the glenohumeral and coracohumeral ligaments. The coracoacromial ligament plays a significant role in the formation of the coracoacromial arch in the neonatal shoulder. The presence of a capsular rotator interval indicates that this aspect of capsular anatomy is congenital.