The atrial natriuretic peptide (ANP) gene is expressed in several extracardiac tissues where ANP is thought to be involved in autocrine or paracrine regulation. The current studies were designed to characterize the ANP system in rat ovaries. ANP content in rat ovaries was estimated by RIA to be 240 +/- 70 pg/mg protein. HPLC revealed the presence of the 28-amino acid circulating peptide as well as the 126-amino acid prohormone, suggesting that the ovaries are a site of ANP synthesis. Indeed, ANP messenger RNA was detected in this tissue by RNase mapping. ANP present in ovarian extracts displaced [125I]ANP from bovine adrenal receptors (R1 class) in a dose-dependent manner and in parallel to the synthetic peptide, indicating that it possesses biological activity. Immunocytochemical studies localized ANP to interstitial cells surrounding the follicles; weaker but specific staining was also observed in the ovum. High affinity ANP receptors (dissociation constant, 0.30 +/- 0.06 nM; maximum binding capacity, 160 +/- 40 fmol/mg protein) were identified in ovarian membranes. Unlabeled ANP but not c-atrial natriuretic factor (a specific agonist of ANP clearance receptors) competed with binding of [125I]ANP to ovarian membranes in a dose-dependent manner, suggesting that ovarian ANP receptors are predominantly of the R1 class. This was confirmed by cross-linking studies with [125I]ANP, which detected a single protein band with a molecular size of about 120 kilodaltons, corresponding to that of the guanylate cyclase-coupled R1 class of receptor. Consistent with the presence of biologically active receptors, ANP markedly enhanced cGMP accumulation (by 15-fold) in ovarian cells. The presence of both local ANP synthesis and high affinity transducing receptors in the ovaries indicates that the peptide plays a local role in ovarian growth or steroidogenesis.