Oestrogen and progesterone have specific receptors in the central nervous system and are able to regulate neuronal development and plasticity, neuronal excitability, mitochondrial energy production, and neurotransmitter synthesis, release, and transport. On neuronal excitability, estradiol and progesterone seem to have an opposite effect, with estradiol being excitatory and progesterone and its derivative allopregnanolone being inhibitory. Estradiol augments N-methyl-d-aspartate-mediated glutamate receptor activity, while progesterone enhances gamma-aminobutyric acid-mediated chloride conductance. Sex steroid regulation of the balance of neuroexcitatory and neuroinhibitory activities may have a role in modulating clinical susceptibility to different neurological conditions such as migraine, catamenial epilepsy, premenstrual dysphoric disorder, and premenstrual syndrome.