Allopregnanolone is a positive allosteric modulator of GABAA receptors, generated by the reduction of 5alpha-dihydroprogesterone (5alpha-DHP) in astrocytes. This neuroactive steroid can be inactivated by its 3alpha-oxidation to yield 5alpha-DHP. It was found that 5alpha-DHP levels in HEK293 cells expressing type 10 17beta-hydroxysteroid dehydrogenase (17beta-HSD10), but not its catalytic inactive mutant, increased significantly as allopregnanolone was added to culture media. The results demonstrate that mitochondrial 17beta-HSD10 effectively catalyzes the intracellular oxidation of allopregnanolone. Moreover, brain astrocytes contain a moderate level of 17beta-HSD10, which is elevated in activated astrocytes of brains with Alzheimer type pathology, including sporadic Alzheimer's disease (AD) and Down's syndrome with AD. The distribution of 17beta-HSD10 was found not to parallel that of 3alpha-HSD3. Cerebral cortex has the lowest level of 17beta-HSD10; whereas the hippocampus, hypothalamus, and amygdala possess relatively higher levels of this enzyme. The catalysis of 17beta-HSD10 appears to be essential for maintaining normal functions of GABAergic neurons. The elevated level of 17beta-HSD10 in activated astrocytes is a new feature found in brains of people with AD, and it may have important impact on AD pathogenesis.