Decidualisation of the endometrial stroma is critical to create a specialised environment for embryo implantation and trophoblast invasion; however, the mechanisms involved are poorly understood. We have established that activin A is an important regulator of decidualisation of endometrial stromal cells in vitro. Here we describe studies that verify the physiological significance of these findings. We demonstrate that high concentrations of activin A are produced by decidualising cells in excess of the antagonists, inhibin and follistatin, thus confirming its bioavailability within the decidual environment. Furthermore, we demonstrate that all components of the activin signalling pathway (activin receptors and Smads) are expressed in decidualised cells, and identify a downstream mechanism for activin in the endometrium, through the regulation of matrix metalloproteinases (MMPs). This new knowledge is important for understanding the roles for activins and inhibins in regulating fertility.