It is well established that spermatogenesis is controlled by gonadotrophins and testosterone. However, a role for estrogens in male reproduction recently was suggested in adult mice deficient in estrogen receptor alpha. These mice became infertile primarily because of an interruption of fluid reabsorption by the efferent ductules of the epididymis, thus leading to a disruption of the seminiferous epithelium [Hess, R. A., Bunick, D., Lee, K. H., Bahr, J., Taylor, J. A., Korach, K. S., and Lubahn, D. B. (1997) Nature (London) 390, 509-512]. Despite the demonstration of the aromatase enzyme, which converts androgens to estrogens, and estrogen receptors within the rodent seminiferous epithelium, the role of aromatase and estrogen in germ cell development is unknown. We have investigated spermatogenesis in mice that lack aromatase because of the targeted disruption of the cyp19 gene (ArKO). Male mice deficient in aromatase were initially fertile but developed progressive infertility, until their ability to sire pups was severely impaired. The mice deficient in aromatase developed disruptions to spermatogenesis between 4.5 months and 1 year, despite no decreases in gonadotrophins or androgens. Spermatogenesis primarily was arrested at early spermiogenic stages, as characterized by an increase in apoptosis and the appearance of multinucleated cells, and there was a significant reduction in round and elongated spermatids, but no changes in Sertoli cells and earlier germ cells. In addition, Leydig cell hyperplasia/hypertrophy was evident, presumably as a consequence of increased circulating luteinizing hormone. Our findings indicate that local expression of aromatase is essential for spermatogenesis and provide evidence for a direct action of estrogen on male germ cell development and thus fertility.