When the Y chromosome of the Mus musculus domesticus mouse (Tirano, Italy) is placed onto the C57BL/6J (B6) background, the XY progeny (B6.Y^DOM) develop only ovaries or ovotestes in fetal life. In the present study, we examined transcription of genes known to be involved in gonadal sex differentiation in the B6.Y^DOM gonad. RNA was isolated from each gonad at 10 to 18 days of gestation and subjected to RT-PCR analysis. The results indicate that the onset of Sry, a putative testis-determining gene, transcription was normal, whereas its inactivation was delayed in all B6.Y^DOM gonads. Transcripts of Müllerian inhibiting substance, the earliest biochemical product of fetal Sertoli cells, appeared in the B6.Y^DOM ovotestis slightly later than in the control B6, XY gonad, whereas they were either absent or detected transiently in the B6.Y^DOM ovary. Transcription of 3β-hydroxysteroid dehydrogenase and 17α-hydroxylase, essential for testosterone synthesis, were equally delayed in the B6.Y^DOM ovotestis and completely absent in the B6.Y^DOM ovary. P450 aromatase (P450arom), which converts androgens to estrogens, was transcribed in both control XX and XY gonads at the onset of morphological sexual differentiation. The overall pattern of P450arom transcription was delayed by 1 day in both B6.Y^DOM ovotestes and ovaries. In conclusion, the testis-determining pathway in the B6.Y^DOM gonad appears to be impaired downstream of Sry transcription, resulting in persistent Sry transcripts and a delay in onset of other genes involved in testicular differentiation.