The results of the Women's Health Initiative (WHI) led to a distinct decline in the routine use of estrogen as preventive therapy for vasomotor symptoms, osteoporosis, and cardiovascular disease in postmenopausal women. Without estrogen replacement, one third of women experience symptoms of atrophic vaginitis including dryness, irritation, itching and or dyspareunia. Local application of estrogen has been shown to relieve these symptoms and improve quality of life for these women. In addition, local estrogen therapy may have a favorable effect on sexuality, urinary tract infections, vaginal surgery, and incontinence. This review examines the effects of vaginally applied estrogen on the vaginal epithelium, urethra and endometrium. An accompanying review examines the systemic effects of vaginally applied estrogen.