In this stage, the uterus expels the placenta (afterbirth). The placenta is usually birthed within 15-30 minutes of the baby being born. Maternal blood loss is limited by contraction of the uterus following birth of the placenta. Normal blood loss is less than 600 mL.

The third stage can be managed either expectantly or actively. Expectant management (also known as physiological management) allows the placenta to be expelled without medical assistance. Breastfeeding soon after birth and massaging of the top of the uterus (the fundus) causes uterine contractions that encourage birth of the placenta. Active management utilizes oxytocic agents and controlled cord traction. The oxytocic agents augment uterine muscular contraction and the cord traction assists with rapid birth of the placenta. A Cochrane database study suggests that blood loss and the risk of postpartum bleeding will be reduced in women offered active management of the third stage of labour. However, the use of ergometrine for active management was associated with nausea or vomiting and hypertension, and controlled cord traction requires the immediate clamping of the umbilical cord. Although uncommon, in some cultures the placenta is kept and consumed by the mother over the weeks following the birth. This practice is termed Placentophagy.