In human prostate, dehydroepiandrosterone (DHEA) is a substrate for two major metabolic pathways that produce functionally opposing sex steroids. In one pathway, DHEA is converted into potent androgens such as testosterone and 5alpha-dihydrotestosterone. In the other, DHEA is metabolized to 7alpha-hydroxy-DHEA (7HD). Recently, CYP7B, a novel P450 enzyme originally characterized in mouse brain and expressed in rodent prostate, has been found to be responsible for all extrahepatic 7alpha-hydroxylase activity. In this study, we have investigated the expression and function of this novel enzyme in human prostate. We have used reverse transcription combined with PCR and mRNA in situ hybridization to determine and localize the expression of CYP7B mRNA in human benign prostatic hyperplasia. High levels of CYP7B mRNA were localized in the epithelial cells together with estrogen receptor beta (ERbeta). 7alpha-Hydroxylation was the major metabolic fate of DHEA in human prostate. Furthermore, we have shown that human prostate epithelial cells in primary culture maintain a high level of 7alpha-hydroxylase activity, which was enhanced by coculture with stroma cells. To investigate the functional relevance of CYP7B expression to sex-steroid action in prostate, we used transient transfections and ligand binding assay to determine the ability of 7HD to bind and activate the sex-steroid receptors: androgen receptor, ERalpha, and ERbeta. 7HD specifically activates ERbeta-mediated transcription, mimicking the effects of 17beta-estradiol, but has no impact on ERalpha and androgen receptor. Given that DHEA, and its sulfate, circulate at micromolar concentrations, there is a clear possibility that CYP7B generates sufficient 7HD to activate ERbeta over and above that achieved with very low concentrations of intraprostatic 17beta-estradiol. In conclusion, our study suggests that CYP7B catalyzes oxysterol 7alpha-hydroxylation within the human prostate epithelium. By this reaction, an ERbeta-specific agonist, 7HD, is produced. Therefore, CYP7B may be a novel regulator of the androgens/estrogenic balance within the prostate.