Local formation of estradiol in human breast tumors could provide a more important source of estrogen than is delivered from plasma. Prior studies have suggested that estrone is primarily synthesized from estrone sulfate. The enzyme 17 beta-hydroxysteroid dehydrogenase (HSD) would be required to convert estrone to estradiol. This study characterized HSD in 1000 X g supernatants from human breast tumors. Estradiol synthesis was linearly related to tissue concentration or time over the range studied. Cofactor requirements varied with estrone concentration. High and low affinity sites were found in 50% of tissues studied, while the remainder contained only low affinity sites. Screen assays showed measurable activity in all 42 samples tested. This activity ranged from 0.73- greater than 100 nmol estrone synthesized/g protein/hr, with a median activity of 5.9 nmol/g/hr. We evaluated the biological relevance of the sulfatase-HSD pathway by testing the ability of estrone sulfate to stimulate colony formation in soft agar cultures of nitrosomethylurea-induced rat mammary tumors. The maximally effective concentration ranged from 10(-7) to 10(-4)M. Significant stimulation of colony formation was observed in 7 of 8 experiments. The estrone sulfate stimulation pattern was similar to that previously observed with estradiol. Of the 3H-estrone sulfate added to the dishes, 20-98% was recovered as estrone and 0.2-6% as estradiol. These studies suggest that the requisite enzymes are present in human breast tumors for conversion of estrone sulfate to estradiol, and that this pathway may be biologically significant.