Family size is the outcome of sequential decisions influenced both by preferences and by ongoing changes in the environment where a family lives. During the last two decades, the gap between the number of children women prefer and their actual fertility has widened in Spain. The paper uses the 1985 and 1999 Spanish Fertility Surveys to study whether the tightening of the labor market and worsening of economic conditions in Spain during the last 20 years are important determinants of this change. I find that women facing high unemployment rates in their mid-twenties tend to restrict their fertility below their ideal level. Among women in the labor force, the stability of a public sector job lessens the difficulties of balancing employment and family and of achieving preferred fertility. Temporary contracts work in the opposite direction. Findings are robust to the inclusion of controls for within-couple discrepancies in either preferences or religious affiliation.This paper was made possible by Grant Numbers P30-HD18288 and T32-HD007302 from the NICHD. Its contents are solely the responsibility of the author and do not necessarily represent the official views of the NIH. I would like to thank Evelyn Lehrer, Robert Kaestner and two anonymous referees for their comments.