Hypogonadism, irrespective of its etiology, has a negative impact on various physiologic parameters. These parameters may improve with testosterone replacement therapy. Before 1990, intramuscular testosterone esters were the principal modality of testosterone replacement in men with hypogonadism. Although effective, they have a non-physiologic pharmacokinetic profile. Recently, transdermal preparations of testosterone have become widely available. These include a scrotal patch, non-scrotal patches and, the most recent development, a gel. Several studies have shown that transdermal testosterone replacement is physiologic, efficacious and has a good safety profile. Transdermal testosterone replacement improves bone mass and lean body mass, decreases fat mass, and improves mood and sexual function. There are no harmful effects on the prostate and lipids. Acne, polycythemia, and gynecomastia are less common with this form of therapy than with the intramuscular esters.