Aromatase and seladin-1 are enzymes that have major roles in estrogen synthesis and are important in both brain physiology and pathology. Aromatase is the key enzyme that catalyzes estrogen biosynthesis from androgen precursors and regulates the brain's neurosteroidogenic activity. Seladin-1 is the enzyme that catalyzes the last step in the biosynthesis of cholesterol, the precursor of all hormones, from desmosterol. Studies indicated that seladin-1 is a downstream mediator of the neuroprotective activity of estrogen. Recently, we also showed that there is an interaction between aromatase and seladin-1 in the brain. Therefore, the expression of local brain aromatase and seladin-1 is important, as they produce neuroactive steroids in the brain for the protection of neuronal damage. Increasing steroid biosynthesis specifically in the central nervous system (CNS) without affecting peripheral hormone levels may be possible by manipulating brain-specific promoters of steroidogenic enzymes. This review emphasizes that local estrogen, rather than plasma estrogen, may be responsible for estrogens' protective effects in the brain. Therefore, the roles of aromatase and seladin-1 and their interactions in neurodegenerative events such as Alzheimer's disease (AD), ischemia/reperfusion injury (stroke), and epilepsy are also discussed in this review.