Zearalenone (ZON) is one of the worldwide most common mycotoxins and exhibits estrogenic activity in the range of natural steroid estrogens such as 17β-estradiol (E2). The occurrence of ZON has been reported in drainage water, soil, wastewater effluents and rivers, but its ecotoxicological effects on fish have hardly been investigated. In this study the estrogenic potency of the ZON was compared to E2 in a recombinant yeast estrogen screen (rYES) and the effects of waterborne ZON exposure on reproduction, physiology and morphology of zebrafish (Danio rerio) were investigated in a 42-day reproduction experiment. E2 as well as ZON evoked a sigmoid concentration–response curve in the rYES with a mean EC50 of 2 and 500 μg/L, respectively, resulting in an E2:ZON EC50 ratio of 1:250. Exposure to ZON for 21 days reduced relative spawning frequency at 1000 and 3200 ng/L to 38.9 and 37.6%, respectively, and relative fecundity at 100, 320, 1000 and 3200 ng/L to 74.2, 41.7, 43.8 and 16.7%, respectively, in relation to the 21-day pre-exposure period. A 4.4 and 8.1 fold induction of plasma vitellogenin (VTG) was observed in male zebrafish at 1000 and 3200 ng/L ZON, respectively. Exposure to ZON did not affect fertility, hatch, embryo survival and gonad morphology of zebrafish. The results of this study demonstrate that although ZON possesses a moderate estrogenic potency in vitro, it exhibits a comparably strong effect on induction of VTG and reproduction in vivo. This indicates that ZON might contribute to the overall estrogenic activity in the environment and could therefore pose a risk for wild fish in their natural habitat.