Over 50years of rigorous empirical attention to the study of sexual differentiation of the brain has produced sufficient data to reveal fundamental guiding principles, but has also required the generation of new hypotheses to explain non-conforming observations. An early emphasis on the powerful impact and essential role of gonadal steroids is now complemented by an appreciation for genetic contributions to sex differences in the brain. The organizing effects of early steroid hormones on reproductively relevant brain regions and endpoints are largely dependent upon neuronal aromatization of androgens to estrogens. The effect of estradiol is mediated via estrogen receptors (ER). The presence or absence of ER can restrict hormone action to select cells and either prevent or invoke cell death. Alternatively, ER activation can initiate signaling cascades that induce cell-to-cell communication and thereby transduce organizational steroid effects to large numbers of cells. However, the specific details by which cell death and cell-to-cell communication are achieved appear to be locally, even cellularly, unique and specific to that particular subpopulation. As the field moves forward the increasingly specific and detailed elucidation of mechanism challenges us to generate new guiding principles in order to gain a holistic understanding of how the brain develops in males and females.