Initial studies on inhibin, activin and follistatin focussed on their role as regulators of adult gonadal function via feedback regulation of anterior pituitary hormones and via intragonadal control of steroid hormones. The discovery of isoforms of follistatin which are either secreted or retained on the cell surface and which bind activin and, to a lesser extent, inhibin adds a further dimension to the regulation of these peptides. More recently, the cloning of inhibin and activin, and the observation of their close homology to the transforming growth factor-/? family of peptides, has led to an interest in their possible role as growth and differentiation factors. Activin, inhibin and follistatin are expressed in embryonic and fetal tissues, as well as in the placenta. However, although activin is a potent regulator of growth and differentiation in a number of cell types, their role in embryonic and fetal development has yet to be established.High concentrations of inhibin have been observed in the fetal gonads, particularly the testes, and in the fetal adrenals of a number of species and a sex difference in fetal plasma concentrations has also been observed. Although the stimulus for high concentrations of inhibin in the fetus is not know, they are associated with decreased testicular testosterone and a decrease in the concentration of circulating follicle-stimulating hormone (FSH); this suggests that, as in the adult, inhibin may be involved in the regulation of fetal testicular androgen and pituitary FSH secretion during late gestation. The recent reports of elevated concentrations of inhibin and, particularly, activin in amniotic fluid during late gestation and its ability to stimulate the production of prostaglandin E2 by fetal membranes provides yet another potential role for this hormone in the regulation of events leading to parturition.