Estrogen (E) deficiency leads to an expansion of the pool of tumor necrosis factor (TNF)-producing T cells through an IFN-␥-dependent pathway that results in increased levels of the osteoclastogenic cytokine TNF in the bone marrow. Disregulated IFN-␥ production is instrumental for the bone loss induced by ovariectomy (ovx), but the responsible mechanism is unknown. We now show that mice with T cell-specific blockade of type  transforming growth factor (TGF) signaling are completely insensitive to the bone-sparing effect of E. This phenotype results from a failure of E to repress IFN-␥ production, which, in turn, leads to increased T cell activation and T cell TNF production. Furthermore, ovx blunts TGF levels in the bone marrow, and overexpression of TGF in vivo prevents ovx-induced bone loss. These findings demonstrate that E prevents bone loss through a TGF-dependent mechanism, and that TGF signaling in T cells preserves bone homeostasis by blunting T cell activation. Thus, stimulation of TGF production in the bone marrow is a critical ''upstream'' mechanism by which E prevents bone loss, and enhancement of TGF levels in vivo may constitute a previously undescribed therapeutic approach for preventing bone loss.A lthough multiple genotropic and nongenotropic effects contribute to explain how estrogen (E) controls bone remodeling (1, 2), most of the bone-sparing activity exerted by E occurs through modulation of bone cell life span and decreased cytokine-driven osteoclastogenesis (3, 4). Among the factors that up-regulate osteoclast (OC) formation and lead to bone loss in estroprevic humans and rodents is tumor necrosis factor (TNF) ␣ (5). This E-regulated cytokine promotes osteoclastogenesis by augmenting the production of receptor activator of nuclear factor-B ligand (RANKL) (1), the nonredundant cytokine responsible for OC development (6) and by increasing the responsiveness of maturing OCs to this factor (7-9). Furthermore, TNF stimulates the production of other cytokines known to be implicated in the pathogenesis of ovariectomy (ovx)-induced bone loss, such as IL-1, IL-6, IL-7, and macrophage colony-stimulated factor (1, 10).ovx increases TNF levels in the bone marrow (BM) via an expansion of the pool of TNF-producing T cells (7, 11) induced by a complex mechanism driven by IFN-␥ (12). This cytokine augments antigen (Ag) presentation by enhancing MHCII expression on BM macrophages (BMMs), through induction of class II transactivator (CIITA) expression (13). Up-regulation of Ag presentation results, in turn, in increased T cell activation. Thus, upregulation of IFN-␥ production induced by ovx leads to increased T cell proliferation and life span, a phenomenon that results in an increase in both the total number of T cells and the pool of TNF-producing T cells (12). T cell-produced TNF plays a pivotal role in the mechanism of ovx-induced bone loss, as demonstrated by the failure of ovx to induce bone loss in T cell-deficient nude mice and by the ability to reconstitute with WT T cells, but not TNFϪ͞Ϫ ...