Even with surfactant therapy, premature males experience disproportionate morbidity and mortality. Slower maturation of skin in males might account at least in part for these gender differences, because increased transepidermal water loss (TEWL) can result in fluid/electrolyte imbalance, energy loss, and systemic infections. We measured TEWL in fetal rats on d20, when a functional barrier is being formed, and found that males had higher TEWL rates. Maternal estrogen (E) treatment resulted in competent barriers in all pups on d20, with the appearance of mature lamellar bilayers in the stratum corneum (SC) interstices. To examine if E acts directly, skin explants from d17 fetal rats were incubated in serum and hormone free media. Control explants after 2 days of culture lacked a distinct SC or a competent barrier to water loss, while E-treated explants displayed a multi-layered SC, mature lamellar bilayers, and a competent barrier. Thus E accelerates skin barrier maturation in vivo and in vitro. In contrast, testosterone (T) treatment delayed barrier formation both in utero on d20, and in the explant system. To determine if androgens cause the delay in barrier formation in males, pregnant rats were treated with the anti-androgen flutamide. This eliminated the gender difference in TEWL on d20. Thus, T also affects skin directly and delays barrier maturation. T is likely to mediate the gender difference in skin maturation in the fetal rat.