Glucocorticoids affect a wide range of processes in the brain, altering neurotransmission, electrophysiological activity, metabolism, cell division, and death. These actions are mediated by corticosteroid receptors (glucocorticoid and mineralocorticoid) that modify transcriptional activity of target genes. The amount of steroid available to activate these receptors is not only dependent on the circulating levels but also on pre-receptor metabolism of glucocorticoids occurring intracellularly. This metabolism is carried out by the enzymes 11beta-hydroxysteroid dehydrogenases (11beta-HSDs). There are two distinct isozymes, the products of distantly related genes. 11beta-HSD type 2 inactivates glucocorticoids to its inert 11-keto derivative, while 11alpha-HSD type 1 elevates intracellular glucocorticoid levels by regenerating active glucocorticoids from circulating 11-dehydrocorticosterone or cortisone. This review highlights the important and very different roles the two enzymes play in the brain, outlining recent results obtained from studying mice with a targeted gene deletion in the 11beta-HSD1 or 11beta-HSD2 genes.