Estrogen production within the testis has been a subject of considerable controversy for many years. Several studies have shown that both Sertoli and Leydig cells produce estrogen during different stages of development. Therefore, we have conducted experiments to localize aromatase, a cytochrome P450 enzyme that converts androgen to estrogen, within the testis. First, P450 aromatase (P450arom) was localized in germ cells of the adult mouse testis by immunocytochemistry, using an antiserum generated against purified human placental cytochrome P450arom. In the germinal epithelium, P450arom was located primarily in the Golgi region of round spermatids, throughout the cytoplasm of elongating spermatids, and along the flagella of late spermatids. Second, localization of P450arom within the germinal epithelium was supported by Western blot analysis of isolated germ cells. Third, Northern blot analysis using a mouse P450arom cDNA probe indicated that the mRNA for the mouse P450arom was present in testicular germ cells. Fourth, P450arom activity was measured in germ cells by the 3H2O water assay. Based upon these observations, we conclude that germ cells are a site of estrogen synthesis in the adult mouse testis.