It is reported that steroid synthesis in ovarian cells is affected by epidermal growth factor (EGF). We cultured luteal cells from pregnant rats for 2 days with or without EGF, followed by incubation of the cells with or without stimulants (hCG, forskolin and dibutyryl cyclic AMP) for 5 hours. The levels of progesterone, 20 alpha-hydroxy-pregn-4-en-3-one (20 alpha-dihydroprogesterone) and cyclic AMP (cAMP) in the media were assayed. EGF had no effect on the basal levels of progesterone, 20 alpha-dihydroprogesterone and cAMP, but it suppressed these levels which were increased by the stimulants. We investigated binding capacity of [125I]-EGF to ovarian tissue of pregnant rats. Ovarian tissue had specific binding sites for EGF. The maximum number of binding sites was 2.38 fmol/mg tissue and the Kd value was 0.547 nM. It was indicated that EGF modified the reactivity of luteal cells to stimulants; counteracting the tropic effect of gonadotropins. It was shown that this effect of EGF might be exerted through its receptor in luteal cells.