To clarify the sexually dimorphic mechanisms of gonadal sex differentiation, we established an in vitro culture system for gonadal sex differentiation using the teleost fish Oreochromis niloticus. In vivo, the entry of germ cells into meiosis occurs around 35 days after hatching (dah) in XX gonads, whereas in XY gonads, meiotic cells became differentiated around 85 dah. In our in vitro culture system using gonads from young fry at 23 dah, the meiotic cells in the XX gonads appeared after 21 days of culture. In contrast, in the XY gonads, no meiotic cells were detected after 21 days. These results indicate that germ cell differentiation in this culture system progresses in a manner similar to that in vivo. To identify the gene products that are involved in the entry of germ cells into meiosis or in the arrest of germ cells at the gonial stage of gonadal sex differentiation, we performed subtractive hybridization screening with this in vitro culture system. From the screening process, we identified the female-related gene, FR-3, which is a homolog of zebrafish nanos-related gene (nos). The nos gene was expressed after gonadal formation around 35 dah in XX gonads, but not in XY gonads. In situ hybridization indicated that nos is expressed in oogenic meiotic cells, but not in spermatogenic meiotic cells. Further examination revealed that nos was expressed in oogenic meiotic cells after gonadal formation, specifically in teleost fish. Together, nos may be also involved in oogenic meiosis, with the exception of primordial germ cell migration.