We have examined the effects of the pituitary gonadotropins on expression of the progesterone receptor (PR) gene in rat ovary and in granulosa cell cultures. Both gonadotropins (LH/hCG and FSH) rapidly induce PR mRNA expression in the granulosa cells of preovulatory follicles in vivo. Gonadotropins also effectively induce PR mRNA expression in primary cultures of rat granulosa cells, and this action can be mimicked by agents that elevate intracellular cAMP (forskolin or 8-bromo-cAMP). Estrogen does not induce PR mRNA expression in these cells. The cAMP-induced PR mRNA expression in rat granulosa cells is blocked by an inhibitor of transcription, but not by an inhibitor of protein synthesis. Structural characterization of the rat PR gene 5′-flanking region indicates that the proximal promoter does not contain a consensus cAMP response element. However, when luciferase fusion genes containing a 1375-basepair rat PR gene promoter were transiently transfected into rat granulosa cells, luciferase activity could be stimulated several-fold by hCG or forskolin, but not by estrogen. These results indicate that gonadotropins, most likely acting through a pathway mediated by cAMP, are able to stimulate transcription of the PR gene in rat granulosa cells and suggest a mechanism for regulating the intraovarian actions of progesterone.