Oestradiol is both a peripheral hormone and a neurosteroid. Oestradiol is synthesized in the adult male and female brain, where it acts as an autocrine factor or a paracrine factor that, under physiological conditions regulates synaptic plasticity, adult neurogenesis, repro¬ductive behaviour, aggressive behaviour, pain processing, affect and cognition (BOX 2). The actions of brain-derived oestradiol contribute to the maintenance of brain homeo¬stasis, and recent findings indicate that it is also a neuroprotective factor, decreasing neural damage in animal models of brain injury and neurodegenerative diseases. In this Review, we describe recent experimental evidence that emphasizes the role of brain oestradiol synthesis as an endogenous neuroprotective mechanism.