Caffeine is commonly used in the neonatal intensive care units for respiratory disorders, but the effects of this medication in the neonatal cerebral circulation remain largely unexplored. We used newborn pigs as a clinically relevant model of the neonatal human brain to investigate the effects of caffeine on cerebral arterioles and primary neurovascular cells. First, we examined dose‐dependent cerebrovascular and systemic effects of water‐soluble anhydrous caffeine in anesthetized newborn pigs equipped with closed cranial windows. Caffeine administered systemically at therapeutic concentrations (20‐40 mg/kg i.v.) had no significant effects on diameter of pial arterioles, mean arterial blood pressure (MABP), and heart rate within 10‐60 min after the injection. When used at a higher concentration (70 mg/kg i.v.), caffeine produced dilation of pial arterioles (15‐20%) accompanied by an increased heart rate, without any effect on MABP. Topical application of caffeine (10‐5‐10‐3M) under the cranial window produced a dose‐dependent dilation of pial cerebral arterioles (15‐30%) that was fully reversed by a brief flushing with artificial cerebrospinal fluid. These in vivo data indicate that cerebral vascular cells are potential targets for caffeine. Next, we tested the hypothesis that caffeine exhibits cytoprotective properties in cerebral circulation during oxidative stress conditions. We used an in vitro model of acute oxidative stress‐induced neurovascular injury caused by excitotoxic and inflammatory conditions concomitant with epileptic seizures, asphyxia, and cerebral ischemia. Endothelial cells and cortical astrocytes are the key components of the neurovascular unit that are most vulnerable to oxidative stress injury. Primary cultures of cerebral vascular endothelial cells (CVEC) and cortical astrocytes from newborn pigs responded to pro‐inflammatory cytokine TNF‐alpha (30 ng/ml) and excitotoxic glutamate (1‐2 mM) by a surge in reactive oxygen species (ROS) production leading to apoptosis. NADPH oxidase is the major ROS‐generating system in the neurovascular unit during inflammation and excitotoxicity. We examined the acute effects of caffeine on oxidative stress‐induced neurovascular cell death caused by TNF‐alpha and excitotoxic glutamate. Caffeine (0.1‐10 µM) inhibited NADPH oxidase activation, reduced overall ROS generation, and attenuated major key events of apoptosis (caspase‐3 activation, DNA fragmentation, and loss of cell‐cell contacts) in CVEC and astrocytes exposed to TNF‐a and glutamate. These data demonstrate, for the first time, that caffeine exhibits acute antioxidant and cytoprotective effects in cerebral vascular endothelial cells and astrocytes. Overall, endothelial and astrocytic components of the neurovascular unit represent target cells for caffeine cytoprotective therapy in the neonatal cerebral circulation during oxidative stress.