Leydig cells in the rat testis can be specifically ablated with ethane dimethane sulfonate (EDS) and will subsequently re-generate. In this study, we have characterized Leydig cell re-generation and expression of selected cell-signaling molecules in a germ cell-free model of EDS action. This model offers the advantage that re-generation occurs on a stable background without confounding changes from the regressing and repopulating germ cell population. Adult rats were treated with busulfan to remove the germ cell population and Leydig cells were then ablated with EDS. Testicular testosterone levels declined markedly within 24 h of EDS treatment and started to recover after 8 days. After EDS treatment there were marked declines in levels of Leydig cell-specific mRNA transcripts coding for steroidogenic enzymes cytochrome P450 11a1 (Cyp11a1), cytochrome P450 17a1 (Cyp17a1), 3beta-hydroxysteroid dehydrogenase type 1 (Hsd3b1), 17beta-hydroxysteroid dehydrogenase type 3 (Hsd17b3) and the LH receptor. Levels of all transcripts recovered within 20 days of EDS treatment apart from Hsd17b3, which remained undetectable up to 20 days. Immunohistochemical localization of CYP11A1 during the phase of early Leydig cell re-generation showed that the Leydig cell precursors are spindle-shaped peritubular cells. Studies on factors which may be involved in Leydig cell re-generation showed there were significant but transient increases in platelet-derived growth factor A (Pdgfa), leukemia inhibitory factor (Lif), and neurofilament heavy polypeptide (Nefh) after EDS, while desert hedgehog (Dhh) levels declined sharply but recovered by 3 days. This study shows that the Leydig cell precursors are peritubular cells and that expression of Pdgfa and Lif is increased at the start of the re-generation process when precursor proliferation is likely to be taking place.