We perform global time-dependent simulations of an accretion disc around a young stellar object with a dead zone ( a region where the magneto-rotational instability can not drive turbulence because the material is not sufficiently ionised ) . For infall accretion rates on to the disc of around 10 ^ { -7 } M _ { \odot } yr ^ { -1 } , dead zones occur if the critical magnetic Reynolds number is larger than about 10 ^ { 4 } . We model the collapse of a molecular gas cloud . At early times when the infall accretion rate is high , the disc is thermally ionised and fully turbulent . However , as the infall accretion rate drops , a dead zone may form if the critical magnetic Reynolds number is sufficiently large , otherwise the disc remains fully turbulent . With a dead zone the disc can become unstable to the gravo-magneto instability . The mass of the star grows in large accretion outbursts that may explain FU Orionis events . At late times there is not sufficient mass in the disc for outbursts to occur but the dead zone becomes even more prominent as the disc cools . Large inner dead zones in the later stages of disc evolution may help to explain observations of transition discs with an inner hole .