Ovarian follicular development is controlled by numerous paracrine and endocrine regulators, including oocyte-derived growth differentiation factor 9 (GDF9), and a localized increase in bioavailable insulin-like growth factor 1 (IGF1). The effects of GDF9 on function of theca cells collected from small (3–6 mm) and large (8–22 mm) ovarian follicles were investigated. In small-follicle theca cells cultured in the presence of both LH and IGF1, GDF9 increased cell numbers and DNA synthesis, as measured by a ³H-thymidine incorporation assay, and dose-dependently decreased both progesterone and androstenedione production. Theca cells from large follicles had little or no response to GDF9 in terms of cell proliferation or steroid production induced by IGF1. Small-follicle theca cell studies indicated that GDF9 decreased the abundance of LHR and CYP11A1 mRNA in theca cells, but had no effect on IGF1R, STAR, or CYP17A1 mRNA abundance or the percentage of cells staining for CYP17A1 proteins. GDF9 activated similar to mothers against decapentaplegics (SMAD) 2/3-induced CAGA promoter activity in transfected theca cells. Small-follicle theca cells had more ALK5 mRNA than large-follicle theca cells. Small-follicle granulosa cells appeared to have greater GDF9 mRNA abundance than large-follicle granulosa cells, but theca cells had no detectable GDF9 mRNA. We conclude that theca cells from small follicles are more responsive to GDF9 than those from large follicles and that GDF9 mRNA may be produced by granulosa cells in cattle. Because GDF9 increased theca cell proliferation and decreased theca cell steroidogenesis, oocyte- and granulosa cell-derived GDF9 may simultaneously promote theca cell proliferation and prevent premature differentiation of the theca interna during early follicle development.