In ruminants, endometrial prostalgandin (PG) F_2alpha causes functional luteolysis, whereas luteal synthesis of PGF_2alpha is required for structural luteolysis. PGE₂ is considered to be a luteoprotective mediator. Molecular aspects of luteal PGF_2alpha and PGE₂ biosynthesis and signaling during the estrous cycle and establishment of pregnancy are largely unknown. The objectives of the present study were 1) to determine the regulation of proteins involved in PGF_2alpha and PGE₂ biosynthesis, catabolism, transport and signaling in the corpus luteum (CL); 2) to investigate the transport of interferon tau (IFNT), PGF_2alpha, and PGE₂ from the uterus to the ovary through the vascular utero-ovarian plexus (UOP); and 3) to compare the intraluteal production of PGF_2alpha and PGE₂ on Days 12, 14, and 16 of the estrous cycle and pregnancy in sheep. Our results indicate that luteal PG biosynthesis is selectively directed towards PGF_2alpha at the time of luteolysis and towards PGE₂ during the establishment of pregnancy. Moreover, the ability of the CL of early pregnancy to resist luteolysis is due to increased intraluteal biosynthesis of PGE₂ and PGE₂ receptor (PTGER) 2 (also known as EP2)- and PTGER4 (also known as EP4)-mediated signaling. We also found that IFNT protein is not transported through the UOP from the uterus to the ovary; in contrast, a large proportion of endometrial PGE₂ is transported from the uterus to the ovary through the UOP. These results indicate that endometrial PGE₂ stimulated by pregnancy is transported locally to the ovary, which increases luteal PGE₂ biosynthesis and hence activates luteal PTGER2 and PTGER4 signaling, thus protecting the CL during the establishment of pregnancy in sheep.