Cryptorchidism was induced experimentally by treating pregnant mice on the 14th day of pregnancy with 5 mg estrogen. Testes from cryptorchid and control newborn and adult mice were investigated with radioimmunoassay and electron microscopy. It was concluded that a normal Leydig cell function plays a decisive role in testicular descent. In cryptorchidism, Leydig cells at birth are atrophic. Testicular testosterone content is diminished as compared to controls. Ultrastructural alterations of Leydig cells observed in our experiments closely resemble those found in biopsies of cryptorchid patients. In male mouse offspring, prenatal estrogen injection induced not only a cryptorchidism but also Leydig cell atrophy and a permanently impaired function. Testosterone content is still significantly diminished after puberty. It is proposed therefore that an insufficiency of endocrine gonadal function of hypothalamo-pituitary origin occurring during intrauterine development is one of the main causes of cryptorchidism. An appropriate long-term therapy could diminish the high sterility rate.