Testosterone replacement in hypogonadal men improves body composition, mood, and sexual functioning. In this 90-d study, we compared the pharmacokinetics and treatment effectiveness of a topical testosterone gel (AA2500) at two concentrations, 50 mg/d and 100 mg/d, to a testosterone patch and placebo gel in 406 hypogonadal men. Pharmacokinetic profiles were obtained, body composition was measured, and mood and sexual function were monitored. AA2500 treatments resulted in dose-dependent improvements in all pharmacokinetic parameters, compared with testosterone patch and placebo. Mean average concentrations at d 90 T were 13.8, 17.1, 11.9, and 7.3 nmol/liter for 50 mg/d AA2500, 100 mg/d AA2500, testosterone patch, and placebo, respectively. At d 90, the 100 mg/d AA2500 treatment improved lean body mass by 1.7 kg and percentage of body fat by 1.2% to a significantly greater degree than either control treatment. Significant improvements in spontaneous erections, sexual desire, and sexual motivation were also evidenced with the 100 mg/d AA2500 dose in comparison with placebo. Testosterone gel was well tolerated; however, the testosterone patch resulted in a high rate of application site reactions. Overall, AA2500 is an effective, well tolerated treatment for hypogonadism.