GP120 (the protein component of the HIV viral coat) is neurotoxic and may contribute to the cell loss associated with AIDS-related dementia. Previously, it has been shown in rat cortical mixed cultures that gp120 increased the accumulation of hydrogen peroxide and superoxide, two reactive oxygen species (ROS). We now demonstrate that gp120 increased activity of the key antioxidant glutathione peroxidase (GSPx), presumably as a defensive mechanism against the increased ROS load. Both estrogen and glucocorticoids (GCs), the adrenal steroid released during stress, blunted this gp120 effect on GSPx activity. The similar effects of estrogen and of GCs are superficially surprising, given prior demonstrations that GCs exacerbated and estrogens protected against gp120 neurotoxicity. We find that these similar effects of estrogen and GCs on GSPx regulation arose, in fact, from very different routes, which are commensurate with these prior reports. Specifically, estrogen has demonstrated antioxidant properties that may prevent the ROS increase (therefore acting as a neuroprotective agent) and rendered unnecessary the compensatory GSPx increased activity. To verify this we have added H2O2 to estrogen + gp120-treated cells, and GSPx activity was increased. However, with addition of H2O2 to GCs + gp120-treated cells there was no increase in activity. GCs appeared to decrease enzyme production and or activity and therefore under insult conditions ROS levels rose in the cell resulting in increased neurotoxicity. Overexpression of GSPx enzyme via herpes vector system reversed the GCs-induced loss of enzyme and eliminated the GCs exacerbation of gp120 neurotoxicity.