Isopycnic separation and unit gravity sedimentation were employed to identify the rat placental cell types capable of producing progesterone and testosterone. Subdivision of Day 12-dispersed placental cells in Percoll gradients revealed that fractions (less than 1.048 g/ml) containing giant cytotrophoblast cells produced greater quantities of progesterone (p less than 0.01) than did fractions (greater than 1.048 g/ml) with equal numbers of placental cells but void of giant cytotrophoblasts. Unit gravity sedimentation of Day 16-dispersed placental cells revealed that when incubated, isolated giant cytotrophoblast cells were capable of producing both progesterone and testosterone. Both of the separation studies strongly suggested that other cell types also produce steroids. However, the biosynthetic capacity of the giant cytotrophoblast cell appeared to be 1000-fold greater than that of the other cell types. Incubation of Day 12-dispersed placental cells with human chorionic gonadotropin or 3',5'-cyclic adenosine monophosphate did not further increase progesterone production as compared to untreated control incubates, suggesting rat placental steroidogenesis is not under trophic hormone control. Electron microscopic observations of giant cytotrophoblast cells revealed a complex ultrastructure suggesting a variety of physiological functions.