Anti-müllerian hormone, normally responsible for the regression of müllerian ducts in male fetuses, induces stunting, germ cell loss, and seminiferous tubule formation in ovaries of bovine freemartin fetuses and of transgenic mice, which express the human anti müllerian hormone gene under the control of the metallothionein promoter. Because the latter have been studied only after birth, we undertook a detailed chronological study of their reproductive organs. Müllerian ducts of transgenic female fetuses regressed at the same time as those of normal or transgenic males. Maximal reduction of germ cell number occurred between 16 days postcoitus and birth, when most transgenic oocytes were still in the leptotene stage of the meiotic prophase, whereas normal oocytes had already reached the pachytene phase. Interference with progression of the meiotic prophase and germ cell loss in the fetal ovary are probably responsible for subsequent ovarian regression and retardation of follicle growth. Seminiferous tubule formation was not detectable prior to birth and occurred only rarely in postnatal ovaries. Aromatase activity of fetal transgenic ovaries was decreased, as well as serum concentration of testosterone in adult transgenic males, suggesting that high levels of anti-müllerian hormone may impair Leydig cell steroidogenesis.