Male and female primordial reproductive ducts coexist for a short period in all mammalian embryos. Müllerian ducts are the anlagen of the uterus, Fallopian tubes, and upper third of the vagina, and develop autonomously in the female in the absence of the testis. Wolffian ducts are the anlagen of the epididymis, vas deferens, and seminal vesicles, and require testosterone to develop. In the mouse, the Wolffian duct requires the action of PAX2 and PAX8, paired genes first discovered in Drosophila. Müllerian duct formation requires the activity of a series of secreted factors whose expression is directed by the WNT family of proteins [10, 11]. The Müllerian duct first forms by invagination of the coelomic epithelium which tubularizes under the influence of Wnt4, then elongates, as the epithelial cells migrate in close approximation to the Wolffian duct [12]. The Wolffian duct provides no cells, but its presence is essential for full elongation of the Müllerian duct to the distal urogenital sinus [13].

Primordial germ cells, the progenitors of the oocytes and spermatocytes, migrate to the urogenital ridge from outside the embryo [14]. They travel from the embryonic ectoderm, along the primitive streak, to the base of the allantois, the wall of the hindgut, and finally exit into the urogenital ridge, where they take up residence in the as yet undifferentiated gonad. Ectopic germ cells outside the urogenital ridge either fail to develop or form tumors [15, 16]. The migratory germ cell phenotype is controlled by integrins [17] and cKit signaling [18] and it is characterized by extensive mitosis [19]. The germ cells proliferate under the influence of Blimp-1 [20], BMP 2,4, and 8b, and Fragilis. Fragilis induces Stella that in turn induces the pluripotency genes Oct/4, Sox2, and Nanog. Germ cell expansion can be detected by expression of alkaline phosphatase and Stella [21, 22] as early as 3 weeks gestation in the human [23]. In addition to proliferation, the germ cells undergo imprint erasure imposed by DNA methylation and complex histone modification to reset epigenetic memory [24–26]. After entering the mesonephros, female germ cells enter meiosis in a characteristic anterior to posterior wave that is under the influence of retinoic acid mediated by the recently discovered gene, stimulated by Retinoic Acid 8 (Stra8). Since the testes degrade retinoic acid, Stra8 is not expressed, meiosis is not initiated, and male germ cells remain arrested in the G0 phase of the cell cycle [27, 28].

The early, undifferentiated gonads exist as a primitive blastema of mesenchymal cells covered by coelomic epithelium. Testicular morphogenesis is initiated by a short burst of expression of the small transcription factors SRY, a master switch gene present on the short arm of the Y chromosome, and the SRY-related autosomal gene SOX 9 from chromosome 17q. The fact that full gonadal differentiation beyond the streak gonad stage requires the Y chromosome or the second X chromosome became evident in 1959 when the 45, X Turner phenotype was first recognized [29]. Subsequent cytogenetic studies localized the male differentiation region to the short arm of the Y chromosome [30, 31]. Later, a single-copy gene, the sex-determining region of the Y chromosome (SRY), was identified that encodes a DNA-binding protein, which is expressed in the gonadal ridge immediately before testis differentiation [32, 33]. When the SRY gene was transfected into XX female mouse embryos, a substantial proportion of these transgenic animals developed testes and assumed anatomic and functional male phenotypes [32, 34].

In addition to the Y chromosome, autosomal and X chromosome factors contribute to sex differentiation. For example, mutations on the long arm of chromosome 17q, found in cases of campomelic dysplasia associated with sex reversal [35–37], caused a defect in the SRY-related gene product, SOX 9, which contributes to sex differentiation. In addition, analysis of 46, XY sex-reversed females with intact SRY led to the discovery of the dosage-sensitive sex (DSS) reversal locus on the short arm of the X chromosome, duplication of which is required for female differentiation [38]. This region, which contains the gene DAX1, was then assumed to have a negative influence on testis differentiation because a double dose of the X chromosome is associated with dysgenesis of the testis. However, knockout of DAX1 resulted in normal female gonadal development [39] which undermines the hypothesis that DAX1 is responsible for ovarian differentiation. The only abnormality seen as a result of null mutation in DAX1 occurs, counter intuitively, in the male, which displays abnormalities in spermatogenesis and spermatic cord formation [40]. Defects in the distal end of the short arm of chromosome 9p [41] and the distal end of the long arm of chromosome 10q [42] are also associated with sex reversal.

The genes responsible for ovarian development remain relatively obscure. Previously, the conventional wisdom was that the ovaries developed passively as a result of the absence of testicular determining genes. It is now clear that Wnt–4 is associated with ovarian development, as homozygous inactivation of Wnt–4 in females leads to masculinized gonads and an absence of the Müllerian ducts [11]. Foxl2, a forkhead transcription factor, is another gene that represses male development, allowing an XY gonad to develop as an ovary [43, 44]. Prenatal ovarian development also appears to be independent of steroid hormone action [45]. Taken together, it is now clear that ovarian differentiation is not simply a default pathway in the absence of testis differentiation [46].

The fetal testis develops seminiferous tubules with Sertoli cells surrounding germ cells and interstitial Leydig cells. The fetal testis produces two products required for further male differentiation, Müllerian Inhibiting Substance (MIS), which inhibits differentiation of the Müllerian duct [47], and testosterone, which stimulates Wolffian structures [47]. The external genital primordia develop autonomously into clitoris, labia minora, and labia majora. Complete differentiation of the external genitalia to phallus and scrotum requires reduction of testosterone to dihydrotestosterone by 5α-reductase [48]. The interaction of dyhydrotestoterone and androgen receptors causes lengthening of the phallus into a penis, fusing of the urogenital folds to form the penile urethra, and fusion of the labioscrotal swellings in the midline to form the scrotum. Autonomous female development can occur in the absence of ovaries.

The existence of a Müllerian inhibitor was proposed by Jost [47], who showed that testicular implants in female rabbit embryos stimulated the Wolffian duct but also caused regression of Müllerian ducts that could not be recapitulated by implants of testosterone alone. This regression is characterized morphologically by programmed cell death. Müllerian Inhibiting Substance (MIS) was purified [49, 50], and then used to clone the MIS gene [51, 52]. The bioactive C-terminal domain of MIS is homologous to a group of evolutionary conserved proteins, referred to as the transforming growth factor-ß (TGF-ß) family [52]. The MIS ligand binds to a heterologous receptor composed of at least two serine–threonine kinase transmembrane units, the type II receptor [53], which phosphorylates or activates the type I receptor [54], which in turn signals downstream via SMAD1/5/8 to initiate a series of molecular events that results in regression of the Müllerian ducts. MIS has been developed as an antiproliferative agent targeting tumors of Müllerian duct origin such as ovarian [23, 55], endometrial [56], cervical [57], cancers, as well as breast [58–60], and prostate [58] cancers. Abnormalities of the MIS gene itself or its receptors can result in the retained Müllerian duct syndrome, in which otherwise normal males, usually with undescended testes, have persistent Müllerian structures that have not undergone normal regression [61, 62].