The great majority of breast carcinomas arising in postmenopausal women are estrogen dependent or positive for estrogen receptor (ER) in carcinoma cells despite markedly low plasma or circulating estrogen concentrations. In these patients, biologically active estrogens are locally produced from circulating inactive steroids including adrenal androgens in an intracrine mechanism in the breast cancer tissues and confer estrogenic activities on carcinoma cells. A series of enzymes are involved in this intra-tumoral or in situ production of estrogens in breast carcinoma tissues but aromatase, a member of the cytochrome P450 family, is a key enzyme of estrogen production through conversion from circulating adrenal androgens in estrogen-dependent postmenopausal breast cancer. It then becomes important to identify the sites of this estrogen production. There has been, however, controversy regarding intra-tumoral localization of aromatase in breast carcinoma, especially whether intra-tumoral production of estrogens through aromatase occurs in carcinoma or stromal cells. The enzyme was demonstrated to be expressed in both carcinoma and stromal cells in breast carcinoma tissues on immunohistochemistry with a well-characterized mAb 677 and combined laser capture microdissection/qualitative reverse transcriptase–polymerase chain reaction. Intra-tumoral aromatase in both of these cell types was subsequently demonstrated to be induced by carcinoma–stromal interactions associated with carcinoma invasion in breast tissue. The signals through various nuclear receptors, especially estrogen-related receptor-α in carcinoma cells and liver receptor homologue-1 in adipocytes adjacent to carcinoma invasion, in conjunction with various cytokines and/or growth factors, play pivotal roles in this induction of intra-tumoral aromatase. This increased aromatase subsequently results in increased in situ estrogen concentrations of breast cancer. Aromatase inhibitors are currently established as the gold standard for the treatment for ER-positive breast carcinoma but resistance to the therapy still remains to be solved by other modes of suppression of intra-tumoral estrogen production.