Studies of neonatal health risks of unconventional natural gas development (UNGD) have not included comprehensive assessments of environmental chemical exposures. We investigated a clustering of dysphagic cases in neonatal foals born between 2014 and 2016 in an area of active UNGD in Pennsylvania (PA),USA. We evaluated equine biological data and environmental exposures on the affected PA farm and an unaffected New York (NY) farm owned by the same proprietor. Dams either spent their entire gestation on one farm or moved to the other farm in late gestation. Over the 21-month study period, physical examinations and blood/tissue samples were obtained from mares and foals on each farm. Grab samples of water, pasture soil and feed were collected; continuous passive sampling of air and water for polycyclic aromatic hydrocarbons was performed. Dysphagia was evaluated as a binary variable; logistic regression was used to identify risk factors. Sixty-five foals were born, 17 (all from PA farm) were dysphagic. Odds of dysphagia increased with the dam residing on the PA farm for each additional month of gestation (OR = 1.4, 95% CI 1.2, 1.7, p = 6.0E-04). Males were more likely to be born dysphagic (OR = 5.5, 95% CI 1.2, 24.5, p = 0.03) than females. Prior to installation of a water filtration/treatment system, PA water concentrations of 3,6-dimethylphenanthrene (p = 6.0E-03), fluoranthene (p = 0.03), pyrene (p = 0.02) and triphenylene (p = 0.01) exceeded those in NY water. Compared to NY farm water, no concentrations of PAHs were higher in PA following installation of the water filtration/treatment system. We provide evidence of an uncommon adverse health outcome (dysphagia) in foals born near UNGD that was eliminated in subsequent years (2017–2019) following environmental management changes. Notably, this study demonstrates that domestic large animals such as horses can serve as important sentinels for human health risks associated with UNGD activities.