To assess whether differences in verbal memory might be related to estrogen use in a group of healthy, well-functioning, postmenopausal community-residing women from a broad socioeconomic range. Healthy postmenopausal women drawn from the general population were given tests of verbal and spatial memory, language, attention, and general spatial skills. The performance of women taking estrogen was compared to that of women from the same population who were not taking any form of estrogen replacement therapy. There were no differences between the estrogen users and non-users on any sociodemographic variables. However, the scores of women taking estrogen were significantly higher on tests of immediate and delayed paragraph recall compared to the scores of non-users. No differences were apparent on other tests of cognitive functioning, including tests of spatial memory. Estrogen appears to have a specific effect on verbal memory skills in healthy postmenopausal women. The clinical relevance of these findings for healthy older women remains to be determined.