Women are chronically exposed to estrogens through oral contraceptives, hormone replacement therapy or environmental estrogens. We hypothesized that chronic exposure to low levels of estradiol-17β (E2) can induce inflammatory and degenerative changes in the tuberoinfundibular dopaminergic (TIDA) system leading to reduced dopamine synthesis and hyperprolactinemia. Young (Y; 3–4 months) and middle-aged (MA; 10–12 months) Sprague–Dawley rats that were intact or ovariectomized (OVX) were either sham-implanted or implanted with a slow-release E2 pellet (20 ng E2/day for 90 days). To get mechanistic insight, adult 3- to 4-month-old WT, inducible nitric oxide synthase (iNOS) and IL-1 receptor (IL-1R) knockout (KO) mice were subjected to a similar treatment. Hypothalamic areas corresponding to the TIDA system were analyzed. E2 treatment increased IL-1β protein and nitrate levels in the arcuate nucleus of intact animals (Y and MA). Nitration of tyrosine hydroxylase in the median eminence increased with E2 treatment in both intact and OVX animals. There was no additional effect of age. This was accompanied by a reduction in dopamine levels and an increase in prolactin in intact animals. E2 treatment increased nitrate and reduced dopamine levels in the hypothalamus and increased serum prolactin in WT mice. In contrast, the effect of E2 on nitrate levels was blocked in IL-1R-KO mice and the effect on dopamine and prolactin were blocked in iNOS KO animals. Taken together, these results show that chronic exposure to low levels of E2 decreases TIDA activity through a cytokine-nitric oxide-mediated pathway leading to hyperprolactinemia and that aging could promote these degenerative changes.