Inhibition of aromatase, the key enzyme in estrogen biosynthesis, is an important strategy in the treatment of breast cancer. Several dietary flavonoids show aromatase inhibitory activity, but their tissue specificity and mechanism remain unclear. This study found that the dietary flavonoid luteolin potently inhibited estrogen biosynthesis in a dose- and time-dependent manner in KGN cells derived from human ovarian granulosa cells, the major source of estrogens in premenopausal women. Luteolin decreased aromatase mRNA and protein expression in KGN cells. Luteolin also promoted aromatase protein degradation and inhibited estrogen biosynthesis in aromatase-expressing HEK293A cells, but had no effect on recombinant expressed aromatase. Estrogen biosynthesis in KGN cells was inhibited with differing potencies by extracts of onion and bird chili and by four other dietary flavonoids: kaempferol, quercetin, myricetin, and isorhamnetin. The present study suggests that luteolin inhibits estrogen biosynthesis by decreasing aromatase expression and destabilizing aromatase protein, and it warrants further investigation as a potential treatment for estrogen-dependent cancers.