Although oestrogen replacement therapy (ERT), which can affect the risk of major cancers, has been known to reduce total plasma homocysteine concentrations in postmenopausal women, the mechanisms and subsequent molecular changes have not yet been defined. To investigate the effect of ERT on homocysteine metabolism, thirteen healthy postmenopausal women were enrolled in a double-blind, placebo-controlled, randomized, cross-over study consisting of two 8-week long phases, placebo and conjugated equine oestrogen (CEE; 0·625 mg/d). Concentrations of total plasma homocysteine, vitamin B6 and serum folate and vitamin B12 were measured by conventional methods. Genomic DNA methylation was measured by a new liquid chromatography/MS method and promoter methylation status of the oestrogen receptor (ER)α, ERβ and p16 genes was analysed by methylation-specific PCR after bisulfite treatment. The CEE phase demonstrated a significantly decreased mean of total plasma homocysteine concentrations compared with the placebo phase (8·08 μmol/l (6·82–9·39) v. 9·29 (7·53–11·35), P < 0·05) but there was no difference in the blood concentrations of the three B vitamins. The CEE phase also showed a significantly increased genomic DNA methylation in peripheral mononuclear cells compared with the placebo phase (2·85 (SD 0·12) ng methylcytosine/μg DNA v. 2·40 ± (SD 0·15) P < 0·05). However, there was no difference in promoter methylation in the ERα, ERβ and p16 genes. This study demonstrates that decreased homocysteinaemia by CEE therapy parallels with increased genomic DNA methylation, suggesting a potential new candidate mechanism by which ERT affects the risk of cancers and a possible new candidate biomarker for the oestrogen-related carcinogenesis through folate-related one-carbon metabolism.