The cystatin CRES (cystatin-related epididymal spermatogenic; Cst8) is the defining member of a reproductive subgroup of family 2 cystatins of cysteine protease inhibitors and is present in the epididymis and spermatozoa, suggesting roles in sperm maturation and fertilization. To elucidate the role of CRES in reproduction, mice lacking the Cst8 gene were generated and their fertility examined. Although both male and female Cst8^−/− mice generated offspring in vivo, spermatozoa from Cst8^−/− mice exhibited a profound fertility defect in vitro. Compared to spermatozoa from Cst8 ^/ mice, spermatozoa from Cst8^−/− mice were unable to undergo a progesterone-stimulated acrosome reaction and had decreased levels of protein tyrosine phosphorylation, suggesting a defect in the ability of Cst8^−/− spermatozoa to capacitate. Incubation of Cst8^−/− spermatozoa with dibutyryl cAMP and 3-isobutyl-1-methylxanthine rescued the fertility defect, including the capacity for sperm protein tyrosine phosphorylation. Both untreated Cst8 ^/ and Cst8^−/− spermatozoa, however, exhibited similar increased total levels of cAMP and protein kinase A (PKA) activity throughout the capacitation time course compared to spermatozoa incubated under noncapacitating conditions. Taken together, these results suggest that mice lacking CRES may have altered local levels of cAMP/PKA activity, perhaps because of improper partitioning or tethering of these signaling molecules, or that the CRES defect does not directly involve cAMP/PKA but other signaling pathways that regulate protein tyrosine phosphorylation and capacitation.