Dioxin is a ubiquitous environmental pollutant that induces toxicity when bound to the aryl hydrocarbon receptor (AhR). Significant differences in susceptibility of mouse strains to dioxin toxicity are largely accounted for by the dissociation constant of binding to dioxins of AhR subtypes encoded by different alleles. We showed that cyclooxygenase-2 (COX-2) and microsomal prostaglandin E synthase-1 (mPGES-1), components of a prostanoid synthesis pathway, play essential roles in the onset of 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD) induced hydronephrosis of neonatal mice. Although C57BL/6J and BALB/cA mice harbor AhR receptors highly responsive to TCDD, they were found by chance to differ significantly in the incidence of TCDD-induced hydronephrosis. Therefore, the goal of the present study was to determine the molecular basis of this difference in susceptibility to TCDD toxicity. For this purpose, we administered C57BL/6J and BALB/cA dams' TCDD at an oral dose of 15 or 80 μg/kg on postnatal day (PND) 1 to expose pups to TCDD via lactation, and the pups' kidneys were collected on PND 7. The incidence of hydronephrosis in C57BL/6J pups (64%) was greater than in BALB/cA pups (0%, p < 0.05), despite similarly increased levels of COX-2 mRNA. The incidence of hydronephrosis in these mouse strains paralleled the levels of renal mPGES-1 mRNA and early growth response 1 (Egr-1) that modulates mPGES-1 gene expression, as well as PGE2 concentrations in urine. Although these mouse strains possess AhR alleles tightly bound to TCDD, their difference in incidence and severity of hydronephrosis can be explained, in part, by differences in the expression of mPGES-1 and Egr-1.