Two clearly opposing views exist on the function of alpha-fetoprotein (AFP), a fetal plasma protein that binds estrogens with high affinity, in the sexual differentiation of the rodent brain. AFP has been proposed to either prevent the entry of estrogens or to actively transport estrogens into the developing female brain. The availability of Afp mutant mice (Afp(-/-)) now finally allows us to resolve this longstanding controversy concerning the role of AFP in brain sexual differentiation, and thus to determine whether prenatal estrogens contribute to the development of the female brain. Here we show that the brain and behavior of female Afp(-/-) mice were masculinized and defeminized. However, when estrogen production was blocked by embryonic treatment with the aromatase inhibitor 1,4,6-androstatriene-3,17-dione, the feminine phenotype of these mice was rescued. These results clearly demonstrate that prenatal estrogens masculinize and defeminize the brain and that AFP protects the female brain from these effects of estrogens.