The increasing incidence of testicular dysgenesis syndrome-related conditions and overall decline in human fertility has been linked to the prevalence of oestrogenic endocrine disrupting chemicals (EDCs) in the environment. Ectopic activation of oestrogen signalling by EDCs in the gonad can impact testis and ovary function and development. Oestrogen is the critical driver of ovarian differentiation in non-mammalian vertebrates, and in its absence a testis will form. In contrast, oestrogen is not required for mammalian ovarian differentiation, but it is essential for its maintenance, illustrating it is necessary for reinforcing ovarian fate. Interestingly, exposure of the bi-potential gonad to exogenous oestrogen can cause XY sex reversal in marsupials and this is mediated by the cytoplasmic retention of the testis-determining factor SOX9 (sex-determining region Y box transcription factor 9). Oestrogen can similarly suppress SOX9 and activate ovarian genes in both humans and mice, demonstrating it plays an essential role in all mammals in mediating gonad somatic cell fate. Here, we review the molecular control of gonad differentiation and explore the mechanisms through which exogenous oestrogen can influence somatic cell fate to disrupt gonad development and function. Understanding these mechanisms is essential for defining the effects of oestrogenic EDCs on the developing gonads and ultimately their impacts on human reproductive health.