Oestrogen, an essential physiological regulator of reproductive function, controls lactotroph proliferation and prolactin release. The neuropeptide galanin co-localizes to the lactotroph, but its physiological function is largely unknown. Pituitary galanin expression is extremely sensitive to the oestrogen status of the animal. A marked elevation occurs during pregnancy and lactation, and exogenous 17 beta-oestradiol can cause a 4,000-fold increase in messenger RNA levels. Here we report that galanin is secreted by a minority of lactotrophs and is essential for the regulation of basal and vasoactive-intestinal-polypeptide-stimulated prolactin release. Hyperoestrogenization increases the number of galanin-secreting cells and the resulting increase in basal prolactin release is completely abolished by treatment with galanin antiserum. Galanin is a potent lactotroph growth factor and galanin-immunoneutralization completely inhibits the previously reported mitogenic effects of oestrogen on the lactotroph. These findings represent direct evidence for paracrine regulation of lactotroph function and demonstrate that the effect of oestrogen on lactotroph proliferation and prolactin release are mediated by locally secreted galanin.