Mutations that inactivate LET-767 are shown to affect growth, reproduction, and development in Caenorhabditis elegans. Sequence analysis indicates that LET-767 shares the highest homology with human types 3 and 12 17beta-hydroxysteroid dehydrogenases (17beta-HSD3 and 12). Using LET-767 transiently transfected into human embryonic kidney-293 cells, we have found that the enzyme catalyzes the transformation of both 4-androstenedione into testosterone and estrone into estradiol, similar to that of mouse 17beta-HSD12 but different from human and primate enzymes that catalyze the transformation of estrone into estradiol. Previously, we have shown that amino acid F234 in human 17beta-HSD12 is responsible for the selectivity of the enzyme toward estrogens. To assess whether this amino acid position 234 in LET-767 could play a role in androgen-estrogen selectivity, we have changed the methionine M234 in LET-767 into F. The results show that the M234F change causes the loss of the ability to transform androstenedione into testosterone, while conserving the ability to transform estrone into estradiol, thus confirming the role of amino acid position 234 in substrate selectivity. To further analyze the structure-function relationship of this enzyme, we have changed the three amino acids corresponding to lethal mutations in let-767 gene. The data show that these mutations strongly affect the ability of LET-767 to convert estrone in to estradiol and abolish its ability to transform androstenedione into testosterone. The high conservation of the active site and amino acids responsible for enzymatic activity and substrate selectivity strongly suggests that LET-767 shares a common ancestor with human 17beta-HSD3 and 12.