The brain is an important target organ for peripherally synthesized estrogen but it also has its own steroid biosynthesis producing estrogen from testosterone catalyzed by the aromatase enzyme. This study examined the effects of estrogen treatment in two spatial memory tasks, one-arm-baited radial arm maze and a position discrimination task in the T-maze in ovariectomized female mice. Hippocampal cytochrome P450 19 (encoding aromatase), and estrogen receptor alpha and beta gene expressions were also measured using real time quantitative polymerase chain reaction analysis. Estrogen (17beta-estradiol) was administered either tonically via s.c. minipellets or phasically via daily i.p. injections. In ovariectomized mice, the tonic estrogen decreased the number of reference memory errors in radial arm maze. Tonic estrogen treatment also up-regulated the expression of cytochrome P450 19 and estrogen receptors. In contrast, estrogen injections decreased the expression of cytochrome P450 19 and estrogen receptor alpha genes. The number of reference memory errors correlated negatively with estrogen receptor alpha expression. These findings indicate that peripheral estrogen levels affect neuronal estrogen synthesis by regulating the cytochrome P450 19 gene expression and also influence estrogen receptor alpha expression. The results also suggest that tonic rather than cyclic estrogen treatment might be more beneficial for cognitive functions.