Leydig cell tumors (LCTs) of the testis are steroid-secreting tumors associated with various steroid biosynthetic abnormalities and endocrine dysfunctions. Despite their overall rarity, LCTs are still of substantial interest owing to the paucity of information regarding their exact nature and malignant potential. In the present study we disclose the ability of androgens to inhibit Leydig tumor cell proliferation by opposing to self-sufficient in situ estrogen production. In rat Leydig tumor cells, R2C, androgen treatment significantly decreases the expression and the enzymatic activity of P450 aromatase, responsible for the local conversion of androgens into estrogens. This inhibitory effect relies on androgen receptor activation and involves negative regulation of the CYP19 gene transcriptional activity through the nuclear orphan receptor DAX-1. Ligand-activated androgen receptor up-regulates the expression of DAX-1 and promotes its increased recruitment within the SF-1-containing region of the PII-aromatase proximal promoter in association with the corepressor N-CoR. The biological relevance in LCTs of the newly highlighted functional interplay between androgen receptor, DAX-1 and aromatase is underlined by our in vivo observations revealing a marked down-regulation of AR and DAX-1 expression and a strong increase in aromatase levels in testes tissues from old Fisher rats with spontaneously developed Leydig cell neoplasia, compared to normal testes tissues from younger animals. In elucidating a mechanism by which androgens modulate the growth of Leydig tumor cells, our finding support the hypothesis that maintaining the adequate balance between androgen and estrogens may represent the key for blocking estrogen-secreting Leydigioma development, opening new prospects for therapeutic intervention.