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Recent studies in both animals and humans indicate that gonadal hormones have profound control over emotional states, and certainly contribute to the increased occurrence of psychiatric illness in women. Reports, as reviewed here, suggest that two important regions of the limbic system, the central nucleus of the amygdala (CeA) and the bed nucleus of the stria terminalis (BNST), control different aspects of emotional behaviour. Short-term cue-specific emotional responses, like Pavlovian fear conditioning, require activation of the CeA, while long-duration and contextual emotional responses, are dependant on the BNST. There is accumulating experimental evidence that gender and sex hormones specifically modulate BNST-mediated anxiety behaviours. Moreover, the functional separation between the CeA and the BNST may be exaggerated during lactation in the rat, a time of profound hormonal and behavioural change. In this study, the effects of sex hormones on fear and anxiety are reviewed with an emphasis on the differential effects of these hormones on functions subserved by the BNST as opposed to the CeA. Studies, as highlighted here, looking at sex hormone and gender effects on the ability of corticotrophin-releasing factor and bright ambient light to enhance startle, emphasise the importance of understanding both the effect of, and brain region where, gonadal hormones exert their control over emotional behaviour.