Substantial evidence supports the concept that estrogens cause breast cancer in animals and in women but the precise mechanism is unknown. The most commonly held theory is that estrogens stimulate proliferation of breast cells and thus statistically increase the chances for genetic mutations which could result in cancer. Another theory is that estrogen metabolism generates oxygen-free radicals and quinones which produce both stable and unstable DNA adducts. Both result in genetic mutations which accumulate and could ultimately cause cancer. A major criticism of the latter hypothesis is that breast tissue contains insufficient concentrations of estrogen for accumulation of genotoxic metabolites. Our hypothesis is that breast tissue estrogen levels, as a result of in situ synthesis, are much higher than previously thought. We and others have shown that estrogen can be made in the breast itself through conversion of androgens to estrogens, a process catalyzed by the enzyme aromatase. The levels of estrogen in the breast increase when aromatase is overexpressed. With sufficient amounts of aromatase in breast tissue, enough estradiol as substrate should be available to allow formation of substantial amounts of genotoxic metabolites. We postulate that aromatase overexpression may in this way cause breast cancer. As evidence supporting this concept, four animal models of aromatase overexpression and either breast cancer or premalignant lesions have been described. We have provided evidence that normal breast tissue can make estrogen and that certain stimulatory compounds can increase aromatase activity in the breast by nearly 10,000-fold. If our concepts are correct, it might be possible to prevent breast cancer by blocking the aromatase enzyme. Drugs are currently available to inhibit aromatase nearly completely without causing significant side-effects. Aromatase inhibitors might be more effective than antiestrogens in preventing breast cancer because of their dual role to block both initiation and promotion of breast cancer. To inhibit the initiation process, these inhibitors would reduce levels of the genotoxic metabolites of estradiol by lowering estradiol concentrations in tissue. At the same time, aromatase inhibitors would inhibit the process of tumor promotion by lowering tissue levels of estradiol and thus blocking cell proliferation. These concepts provide a strong rationale for studies of aromatase inhibitors to prevent breast cancer.