The potent estrogen 17β-Estradiol (E2) plays a critical role in mediating hippocampal function, yet the precise mechanisms through which E2 enhances hippocampal memory remain unclear. In young adult female rodents, the beneficial effects of E2 on memory are generally attributed to ovarian-synthesized E2. However, E2 is also synthesized in the adult brain in numerous species, where it regulates synaptic plasticity and is synthesized in response to experiences such as exposure to females or conspecific song. Although de novo E2 synthesis has been demonstrated in rodent hippocampal cultures, little is known about the functional role of local E2 synthesis in mediating hippocampal memory function. Therefore, the present study examined the role of hippocampal E2 synthesis in hippocampal memory consolidation. Using bilateral dorsal hippocampal infusions of the aromatase inhibitor letrozole, we first found that blockade of dorsal hippocampal E2 synthesis impaired hippocampal memory consolidation. We next found that elevated levels of E2 in the dorsal hippocampus observed 30min after object training were blocked by dorsal hippocampal infusion of letrozole, suggesting that behavioral experience increases acute and local E2 synthesis. Finally, aromatase inhibition did not prevent exogenous E2 from enhancing hippocampal memory consolidation, indicating that hippocampal E2 synthesis is not necessary for exogenous E2 to enhance hippocampal memory. Combined, these data are consistent with the hypothesis that hippocampally-synthesized E2 is necessary for hippocampus-dependent memory consolidation in rodents.