Despite the widespread clinical use of oxytocin (OT) as a potent and specific stimulant of labor, previous research data have not supported a role for OT in the physiology of normal human parturition. We have demonstrated synthesis of OT mRNA in amnion, chorion, and decidua using Northern blot analysis, ribonuclease protection assays, and in situ hybridization. Probes directed towards both the 3' and 5' ends of the gene have been used. Levels were highest in decidua with considerably less in chorion and amnion and very low levels in placenta. The transcript size in decidua appears to be 60-80 nucleotides smaller than the transcripts in amnion and chorion. OT gene expression in chorio-decidual tissues increased three- to fourfold around the time of labor onset. Estradiol stimulated synthesis of OT mRNA during in vitro incubation. These results support the hypothesis of a paracrine system involving OT and sex steroids within intrauterine tissues wherein significant changes could occur without being reflected in the maternal circulation. Such a paracrine system could rationalize a long-sought role for oxytocin in the physiology of human labor. These data may lead to novel approaches towards prevention or treatment or preterm labor.