I was shocked to learn that FDA in 1980 had determined that caffeine in amounts exceeding 300 mg could potentially be teratogenic (1). Teratogens are agents that cause fetal malformations or birth defects. Good thing caffeine does not harm the fetus when taken in smaller amounts, despite evidence in rats to the contrary (1-2).
However, after digging deeper, I found that the researchers did find that caffeine potentiated teratogenic effect of smoking and alcohol (2). The mechanism appears to be through inducing materno-fetal vasoconstrictions that lead to ischemia (2).
If caffeine potentiates effects of other teratogens in amounts less than 300 mg, I imagine it's still wise of pregnant women to avoid caffeine altogether during pregnancy just in case they are exposed to teratogens of some kind and are unaware of it.
1. Mitchell MK. Nutrition Across The Life Span. Long Grove, IL: Waveland Press, 2003.
2. Nehlig A, Debry G. Potential teratogenic and neurodevelopmental consequences of coffee and caffeine exposure: a review on human and animal data. Neurotoxicol Teratol 1994;16:531-43.