Oestrogen has wide ranging effects in development mediated mainly via the two oestrogen receptors, alpha (ESR1, also known as ERalpha) and beta (ESR2, also known as ERbeta). Oestrogen is the key factor that directs the indifferent gonad to become an ovary in many non-mammalian vertebrates. Oestrogen is not required for early ovarian differentiation in mammals but can disrupt normal testicular development in eutherians. Surprisingly, exogenous oestrogen can cause sex reversal of an XY gonad in two marsupials, the North American opossum and the tammar wallaby. To understand the mechanism by which oestrogen induces sex reversal, we characterised the genes for ESR1 and ESR2 and examined their expression during gonadal differentiation in the tammar wallaby, Macropus eugenii. Both receptors were expressed in the somatic cells and germ cells of the indifferent gonad in both XX and XY foetuses throughout all stages of development, and persisted in these cells into adulthood. ERs were also present in many other tissues including kidney, pituitary and mammary gland. ER mRNA was not significantly altered by exogenous oestrogen in cultured XY gonads but the receptors translocated to the nucleus in its presence. These findings confirm that there is conserved expression of the ERs in the indifferent gonad despite the lack of available ligand during early gonadal development. The receptors can respond to exogenous estrogen at this early stage and are capable of transducing signals in the early mammalian gonad. However, the selective forces that maintained conserved ER expression in this tissue remain unknown.