Prostacyclin (PGI₂) in oviducal fluid is synthesised from arachidonic acid by cyclo-oxygenase (COX) and prostacyclin synthetase and enhances the implantation and live birth potential of mouse embryos. In the present study, we investigated the developmental competence of bovine embryos by examining the effects of the PGI₂ analogue iloprost on blastocyst development, quality and COX-2 expression during IVF and somatic cell nuclear transfer (SCNT). Bovine IVF and SCNT embryos were cultured in CR1-aa medium supplemented with 0.3% bovine serum albumin in either the presence or absence of 1 μm iloprost at 38.5°C and 5% CO₂. After 3 days of culture, cleaved embryos were cultured for 4 days in the same medium supplemented with 10% fetal bovine serum. For both IVF and SCNT embryos, iloprost improved the blastocyst developmental rate and cell numbers. In the presence of iloprost, the proportion of expanded blastocysts was significantly higher among the IVF embryos and fewer apoptotic cell nuclei were observed. Expression of COX-2 mRNA and protein, evaluated using real-time polymerase chain reaction and immunoblotting, respectively, was increased in the presence of iloprost. These results suggest that PGI₂ improves the developmental competence of embryos via regulation of the cAMP response element-binding protein–COX-2 signalling pathway in cattle.