Two members of the superfamily of small intracellular carrier proteins for lipophilic compounds are cellular retinoic acid-binding protein and cellular retinoic acid-binding protein II [CRABP(II)]. CRABP is found in many adult tissues, whereas CRABP(II) is more restricted and is reported as abundant primarily in skin. Here we report a much greater expression of CRABP(II) in rat corpus luteum than in any other organ/tissue examined, including skin. A rat complementary DNA clone encoding CRABP(II) was isolated and the ovarian expression followed during gonadotropin induction of follicular development in the pseudopregnant rat. The pattern of rat CRABP(II) messenger RNA and protein expression correlated with the appearance of corpora lutea and the rise in progesterone production as the corpora lutea developed, and was similar to the induction of 3 beta-hydroxysteroid dehydrogenase. Immunohistochemical localization revealed that CRABP(II) appeared in luteal cells and was dramatically restricted to their cytoplasmic compartment, with no apparent presence in the nucleus. This suggests that CRABP(II) may be expressed to restrict retinoic acid from occupying nuclear retinoic acid receptors, implying that the differentiation and maintenance of the rat corpus luteum may involve in part a release of certain pathways from retinoid suppression.