The abnormal regulation of the Ke 6 gene has been linked to the development of recessive polycystic kidney disease in the mouse. In this report, we have shown that Ke 6 is a 17␤-hydroxysteroid dehydrogenase and can regulate the concentration of biologically active estrogens and androgens. The Ke 6 enzyme is preferentially an oxidative enzyme and inactivates estradiol, testosterone, and dihydrotestosterone. However, the enzyme has some reductive activity and can synthesize estradiol from estrone. We find that the Ke 6 gene is expressed within the ovaries and testes. The presence of Ke 6 protein within the cumulus cells surrounding the oocyte places it in a strategic location to control the level of steroids to which the egg is exposed. Previously, it had been shown that glucocorticoids can induce renal cysts in the neonatal rodent, only when given at a narrow time window of postnatal kidney development. We propose that the reduction in the level of Ke 6 enzyme, which occurs in the cpk, jck, and pcy mice, may lead to abnormal elevations in local level of sex steroids, which either directly or indirectly via abnormal glucocorticoid metabolism result in recessive renal cystic disease, a developmental disorder of the kidney.The Ke 6 gene, encoded within the major histocompatibility complex, has been intimately linked to the development of cysts in the kidney and liver of mice (1-6). The expression of the Ke 6 gene is severely down-regulated in all murine models of PKD 1 that have been examined to date: cpk, jck (1, 3) and pcy mice (2). The inhibition of the Ke 6 gene expression using antisense deoxyoligonucleotides in embryonic kidneys in organ cultures gives rise to numerous cysts against a background of normal nephrogenesis (5, 6). Importantly, the human Ke 6 gene is located on chromosome 6p21 (7) where the human autosomal recessive PKD mutation has been mapped (8) and therefore there is a possibility that the Ke 6 gene is the primary mutation in autosomal recessive PKD. The structure of the mouse Ke 6 gene (2), cDNA (1), and protein (4) has been extensively characterized in our laboratory.Our earlier data base searches with the Ke 6 sequence showed that it belongs to the short-chain dehydrogenase/reductase family (1). At that time, Ke 6 was most similar to bacterial oxidoreductases with no close similarity to any mammalian oxidoreductase in the data base, leaving the exact function of Ke 6 unknown. Recently, we searched the data base again with Ke 6 and found it is similar to 17␤HSD4 (9). This prompted us to examine Ke 6 for 17␤HSD activity with various androgen and estrogen substrates.As reported here, we find that Ke 6 protein is an NAD-dependent 17␤HSD, making it the seventh member of this class of enzyme. It efficiently catalyzes the oxidation of estradiol, testosterone, and dihydrotestosterone and also the reduction of estrone to form biologically active estradiol. The identification of the substrate of Ke 6 allows us to postulate that regulated sex steroid metabolism plays a crucial role in the development o...