Estradiol (E-2) and 5 alpha-androstan-3 alpha,17 beta-diol (3 alpha-diol) have been implicated in prostate hyperplasia in man and dogs, but neither of these steroids bind to androgen receptors (ARs). Recently, we reported that E-2 and 3 alpha-diol stimulated generation of intracellular cAMP via binding to a complex of sex hormone-binding globulin (SHBG) and its receptor (R-SHBG) On prostate cells. We speculated that this pathway, involving steroids normally found in the prostate, was involved in the indirect activation of ARs. Using the dog as a model to test this hypothesis in normal prostate, we investigated whether E-2, 3 alpha-diol, and SHBG stimulated the production of the androgen-responsive protein, arginine esterase (AE), the canine equivalent of human prostate-specific antigen. In cultured dog prostate tissue preincubated with SHBG, E-2 and 3 alpha-diol stimulated AE activity. These effects were blocked by hydroxyflutamide, an AR antagonist, and by 2-methoxyestradiol, a competitive inhibitor of E-2 and 3 alpha-diol binding to SHBG. In the absence of exogenous steroids and SHBG, AE also was significantly increased by treatment with forskolin or 8-Bromaodenosine-cAMP. These observations support the hypothesis that in normal prostate, E-2 and 3 alpha-diol can amplify or substitute for androgens, with regard to activation of the AR via the R-SHBG by a signal transduction pathway involving cAMP. Because both E-2 and 3 alpha-diol are involved in the pathogenesis of benign prostatic hyperplasia in dogs and implicated in benign prostatic hyperplasia in man, antagonism of the prostatic SHBG pathway may offer a novel and attractive therapeutic target.