What is the functional difference between fetal hemoglobin and adult hemoglobin?

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In order to understand the functional difference between fetal hemoglobin, and adult hemoglobin, one must first look at the structural differences between the two. 

Structurally, both adult and fetal hemoglobin are tetramers containing four protein subunits. Both types of hemoglobin contain two (out of the possible four) of the same subunits, called the alpha-chains. They differ, however, in the make up of their other two protein subunit structures. In adult hemoglobin, the two other protein subunits of the tetramer are identical beta-chain subunits, while in fetal hemoglobin, the two other subunits are identical gamma subunits. These beta and gamma subunits are very similar, however, differences in the overall subunit conformation leads to an overall different protein structure of fetal hemoglobin when compared to adult hemoglobin.

This change in structure of fetal hemoglobin also leads to a change in function when compared to adult hemoglobin. Experimentally, it has been shown that the structural changes in fetal hemoglobin, caused by the substitution of gamma subunits for beta-chains, allows fetal hemoglobin to have a higher "average affinity" for oxygen. This means that, on average, fetal hemoglobin can bind oxygen more readily than adult hemoglobin. This is important because it ensures a fetus, developing inside the mother and relying on her blood for oxygen, will be able to bind oxygen from her blood stream. This ensures appropriate oxygen levels are present in the fetus through out development. 

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