The extensive literature and the work from our laboratory illustrate the large number of complex processes affected by estrogen that might contribute to the striking ability of 17beta-estradiol (E2) and its derivatives to inhibit clinical and histological signs of experimental autoimmune encephalomyelitis (EAE) in mice. These effects require sustained exposure to relatively low doses of exogenous hormone and offer better protection when initiated prior to induction of EAE. However, oral ethinyl estradiol (EE) and fluasterone, which lacks estrogenic side effects, could partially reverse clinical EAE when given after the onset of disease. The three main areas discussed in this review include E2-mediated inhibition of encephalitogenic T cells, inhibition of cell migration into central nervous system tissue, and neuroprotective effects that promote axon and myelin survival. E2 effects on EAE were mediated through Esr1 (alpha receptor for E2) but not Esr2 (beta receptor for E2), as were its antiinflammatory and neuroprotective effects. A novel finding is that E2 up-regulated the expression of Foxp3 and CTLA-4 that contribute to the activity of CD4+CD25+ Treg cells. The protective effects of E2 in EAE suggest its use as therapy for MS, although the risk of cardiovascular disease may complicate treatment in postmenopausal women. This risk could be minimized by using subpregnancy levels of exogenous E2 that produced synergistic effects when used in combination another immunoregulatory therapy. Alternatively, one might envision using EE or fluasterone metabolites alone or in combination therapies in both male and female MS patients.