In mammals, the phenotype of the homogametic sex develops in the (relative) absence of steroids and the phenotype of the heterogametic sex is imposed by the early action of steroids. In contrast, the heterogametic sex in avian species is the female and the presence of estrogens and their receptors plays a crucial role in female sexual differentiation. The time- and sex-dependent expression of enzymes involved in steroidogenesis which determine the ratio of androgens/estrogens produced by the gonads has been extensively investigated during the last 5-6 years. These results all show that the lack of estrogen synthesis in the male appears to be due to the extremely low levels of 17beta-hydroxysteroid dehydrogenase and P450aromatase expression. In females, extensive expression of the aromatase gene (around day 5-6 of incubation), leading to estrogen synthesis, and specific expression of the estrogen receptor-mRNA in the left gonad results in the development of a functional left ovary. Other sex differences can be found in the expression of the inhibin subunit genes in gonads of chicken embryos and in circulating concentrations of inhibin, follicle stimulating hormone (FSH) and steroids. Sex reversal attempts have been made by varying incubation temperatures, by using anti-estrogens, androgens, aromatase inhibitors and synthetic steroids. In ovo administration of a sex steroid hormone or an inhibitor of endogenous sex steroid synthesis can cause phenotypical sex reversal. All these experiments show that the development of gonads in birds is very sensitive to changes in the embryonic hormonal environment, sometimes resulting in changes of postnatal reproduction and even growth.