Recent studies have demonstrated a critical role for the oocyte in proliferation and differentiation of granulosa cells and expansion of the cumulus oophorus in vitro. The purpose of this study was to determine if steroid production by cumulus granulosa cells was also modulated by oocytes. Mouse oocyte-cumulus cell complexes (intact) and complexes from which the oocytes were removed microsurgically (oocytectomized; OOX) were cultured for 24 h in the presence or absence of follicle-stimulating hormone (FSH; 150 ng/ml), testosterone (T; 5 x 10(-7) M) or both. Oocytectomy had no effect on the ability of cumulus cells to produce progesterone or estradiol in control cultures or in response to T. However, OOX complexes produced 17- and 36-fold more progesterone than intact complexes when cultured in the presence of FSH or FSH+T, respectively. Oocyte-conditioned medium (maximum 1 oocyte/2 microliters) had no effect on progesterone production by intact cumulus complexes, but reduced the progesterone production by OOX complexes by 75%. This inhibition was directly proportional to the number of oocytes used to condition the medium. Oocytectomy caused a slight decrease (29%) in estradiol production by complexes in the presence of FSH and T; however, OOX complexes in oocyte-conditioned medium produced almost twice as much estradiol as complexes in unconditioned medium. These results indicate that mouse oocytes secrete a factor(s) that inhibits progesterone and stimulates estradiol production by cumulus granulosa cells.