The mechanisms by which estradiol exerts specific actions on neural function are unclear. In brain the actions of estrogen receptor (ER) alpha are well documented, whereas the functions of ERbeta are not yet fully elucidated. Here, we report that ERbeta inhibits the activity of ERalpha in an anatomically specific manner within the neonatal (postnatal d 7) brain. Using selective agonists we demonstrate that the selective activation of ERalpha in the relative absence of ERbeta activation induces progesterone receptor expression to a greater extent than estradiol alone in the ventromedial nucleus, but not the medial preoptic nucleus, despite high ERalpha expression. Selective activation of ERbeta attenuates the ERalpha-mediated increase in progesterone receptor expression in the ventromedial nucleus but has no effect in medial preoptic nucleus. These results suggest that ERalpha/ERbeta interactions may regulate the effects of estrogens on neural development and reveal the neonatal brain as a unique model in which to study the specificity of steroid-induced gene expression.