Gonadal sex differentiation is increasingly recognized as a remarkably plastic process driven by species-specific genetic or environmental determinants. Among aquatic vertebrates, gonadal sex differentiation is a frequent endpoint in studies of endocrine disruption with little appreciation of underlying developmental mechanisms. Work in model organisms has highlighted the diversity of master sex-determining genes rather than uncovering any broad similarities prompting the highly conserved developmental decision of testes versus ovaries. Here we use molecular genetic markers of chromosomal sex combined with traditional histology to examine the transition of the bipotential gonads to ovaries or testes in threespine stickleback (Gasterosteus aculeatus). Serially-sectioned threespine stickleback fry were analyzed for qualitative and quantitative indications of sexual differentiation, including changes in gonadal morphology, number of germ cells and the incidence of gonadal apoptosis. We show that threespine stickleback sampled from anadromous and lacustrine populations are differentiated gonochorists. The earliest sex-specific event is a premeiotic increase in primordial germ cell number followed by a female-specific spike in apoptosis in the undifferentiated gonad of genetic females. The data suggest that an increase in PGC number may direct the undifferentiated gonad toward ovarian differentiation.