The endometrial lining of the human uterus is a highly specialized, steroid-sensitive tissue. Throughout the reproductive years, the endometrium undergoes dramatic cycles of growth, differentiation, and breakdown under the influence of ovarian steroids. In response to changes in steroid exposure throughout the menstrual cycle, the endometrium produces an array of bioactive growth factors and other cytokines that are critical components of paracrine communication. For example, cell-cell communication via paracrine factors directs the expression of matrix metalloproteinases (MMPs), enzymes that mediate tissue remodeling during the menstrual cycle. The disease endometriosis is thought to occur as a consequence of retrograde menstruation, and MMPs appear to contribute to the establishment and progression of ectopic endometrial growth in the peritoneal cavity. Although the risk for developing endometriosis is linked to a woman's steroid exposure, locally produced paracrine factors can modify steroid action on multiple gene targets, including the MMPs. Estrogen-associated growth factors as well as inflammatory cytokines are potent stimulators of MMP expression and may contribute to the ability of endometrial fragments to invade the peritoneal surface and establish ectopic sites of growth. In contrast, paracrine factors associated with progesterone action during early pregnancy inhibit MMP expression and prevent ectopic endometrial growth in an experimental model. For example, locally produced retinoic acid and transforming growth factor-β (TGF-β) act in concert with progesterone to suppress MMPs, while enhancing expression of MMP inhibitors (TIMPs) during endometrial differentiation. Targeting pregnancy-associated factors that inhibit endometrial-specific MMP expression and action may enhance the effectiveness of progestin-related treatments for endometriosis.