In addition to their effects on sexual differentiation and reproduction, sex hormones influence the immune system. This results in a gender dimorphism in the immune function with females having higher immunoglobulin levels and mounting stronger immune responses following immunization or infection than males. The greater immune responsiveness in females is also evident in their increased susceptibility to autoimmune diseases. However, a clear understanding of the myriad of effects that sex hormones have on the immune system is lacking. Studies in normal mice show that estrogen treatment induces polyclonal B cell activation with increased expression of autoantibodies characteristic of autoimmune diseases. Several mechanisms appear to contribute to the break in tolerance and the increase in plasma cell activity including a reduction of the mass of the bone marrow and the thymus, the emergence of sites of extramedullary hematopoiesis and altered susceptibility of B cells to cell death. In addition, sex hormone levels in both humans and experimental models correlated with the activity of their cytokine-secreting cells indicating that sex hormones influence the cytokine milieu and suggesting that altered sex hormonal levels in autoimmune patients contribute to the skewed cytokine milieu characteristic of systemic lupus erythematosus (SLE). While sex hormones alone do not cause autoimmune disease, abnormal hormone levels may provide the stage for other factors (genetic, infectious) to trigger disease. Understanding the physiology of the interaction between sex hormones and immune function and its potential pathological consequences may provide insight into the autoimmune diseases and new directions for their treatment.