The ability of progesterone to reduce the cerebral edema associated with traumatic brain damage first became apparent when we observed that males had significantly more edema than females after cortical contusion. In addition, edema was almost absent in pseudopregnant female rats, a condition in which progesterone levels are high relative to estrogen. Progesterone injections given after injury also reduced edema and were equally effective in both males and females. The present experiment was done to determine if the progesterone-induced reduction in edema could also prevent secondary neuronal degeneration and reduce the behavioral impairments that accompany contusion of the medial frontal cortex. Progesterone-treated rats were less impaired on a Morris water maze spatial navigation task than rats treated with the oil vehicle. Progesterone-treated rats also showed less neuronal degeneration 21 days after injury in the medial dorsal thalamic nucleus, a structure that has reciprocal connections with the contused area.