The cellular source and gonadotropic control of follicular 17.beta.-estradiol secretion were investigated. Theca and granulosa isolated from proestrous follicles of immature rats treated with pregnant mare''s serum gonadotropin were cultured separately for 3 days in the presence or absence of LH [luteinizing hormone] (0.1 .mu.g/ml), FSH [follicle stimulating hormone] (0.1 .mu.g/ml), and/or testosterone (5 .times. 10-7 M). Medium was collected and replaced at 3, 6, 12, 24, 48 and 72 h of culture and measured for estradiol by radioimmunoassay. Granulosa cell cultures secreted negligible quantities of estradiol in the absence of exogenous androgen precursor. Addition of testosterone to the culture medium greatly increased the production of estradiol by granulosa cells. Estradiol secretion was sustained throughout the 3-day culture period only if both testosterone and FSH were included in the culture medium. Thecal preparations secreted relatively low amounts of estradiol in the absence of exogenous testosterone and somewhat higher quantities in its presence. Gonadotropins had no apparent effect on estradiol production by thecal preparations. Granulosa cell cultures produced about 9-fold more estradiol during the 3-day culture period than did thecal preparations. While granulosa cell cultures appeared to be homogeneous, thecal preparations contained patches of contaminating granulosa cells. When 2 different types of thecal preparation, one contaminated with granulosa cells and the other almost free of contaminating cells, were compared, estradiol secretion by the cleaner preparations was greatly reduced and negligible compared to secretion by preparations containing granulosa cells. Apparent production of estradiol by the theca might be partly or solely due to production by contaminating cells. These results, together with previous reports that LH stimulates theca, but not granulosa, to secrete testosterone, are consistent with the hypothesis that the theca supplies androgen precursor to the granulosa cells which aromatize it to estradiol.