Endometriosis is a common, chronic and estrogen-dependent gynaecological disorder associated with pelvic pain and infertility. In addition to, or perhaps as a consequence of, immune, environmental and genetic factors, endometriotic lesions show high estradiol (E(2)) biosynthesis and low E(2) inactivation compared with normal endometrium. Current medical therapies of pain, which aim to lower circulating E(2) concentrations, are not effective in at least half of these patients. We and others recently demonstrated the expression of a few steroidogenic genes in endometriosis. The most important genes in this group are steroidogenic acute regulatory protein (StAR) and aromatase. Both are essential for E(2) production. Prostaglandin E(2) (PGE(2)) is the most potent known stimulator of both StAR and aromatase. PGE(2) production in endometriosis is up-regulated by increased levels of the enzyme cyclo-oxygenase-2 (COX-2) in this tissue. COX-2 in turn is stimulated by E(2), interleukin-1beta (IL-1beta) and PGE(2) itself in endometrial and endometriotic cells. Thus, there is a positive feedback loop that favours continuous formation of E(2) and PGE(2) in endometriosis. These basic findings led to recent phase-II studies employing aromatase inhibitors in the treatment of endometriosis. Aromatase inhibitors treat both postmenopausal and premenopausal endometriosis at least as effectively as the existing medical treatments. In premenopausal women, we and others administered aromatase inhibitors in combination with an ovarian-suppressant treatment. In this review, we emphasize the most recent basic studies in detail and provide a short summary of recent clinical trials.