Elevations of sex steroids induced by social cues can rapidly modulate social behavior, but we know little about where they act within the nervous system to produce such effects. In male goldfish, testosterone (T) rapidly increases approach responses to the visual cues of females through its conversion to estradiol. Because aromatase is expressed in the retina, we tested if T can acutely influence retina responses to visual stimuli, and investigated the receptor mechanisms that may mediate such effects. Specifically, we measured FOS protein immunoreactivity to determine if T affects cellular responses to visual stimuli that include females, and used electrophysiology to investigate whether T can generally affect light sensitivity. We found that T acutely increased FOS responses to the simultaneous onset of light and the presence of female visual stimuli, both of which would normally be associated with early morning spawning, and increased electrophysiological responses to low intensity light pulses. Both effects were blocked by an estrogen receptor beta (ERβ) antagonist, indicating that T is likely being converted to estradiol (E2) and acting through an ERβ mediated mechanism to acutely modulate visual processing. Changes in sensory processing could subsequently influence approach behavior to increase reproductive success in competitive mating environments.