The adverse effects of exogenous estrogen on rabbit embryo development in vivo has been confirmed by in vitro culture of pronuclear rabbit zygotes in oviduct fluid and in serum collected during varying hormonal regimens. Only 27 percent and 24 percent of the zygotes developed normally to morula in estrogen-influenced oviduct fluid and serum, respectively. In contrast, 74 percent in oviduct fluid and 85 percent in serum developed normally under progesterone influence. Withdrawal of estrogen treatment for three days resulted in elimination of the inhibition in the serum but not in the oviduct fluid. Addition of estradiol or progesterone in pharmacological doses to serum from ovariectomized animals resulted in no inhibition of embryo development, suggesting that the effect is not directly hormonal but is hormonally mediated. After dialysis against control medium, estrogen-mediated inhibition was eliminated. However, direct addition of all cofactors and amino acids present in the control medium to inhibitory oviduct fluid did not allow normal embryo development. These data suggest the presence of an estrogen-mediated, low molecular weight (<10,000 daltons) inhibitor to embryo development in oviduct fluid.