7,12-Dimethylbenz-[a]anthracene (DMBA) is an environmental carcinogen which has a potent ovotoxic affect on rat and mouse ovaries, causing complete follicular depletion resulting in premature ovarian failure. Although the overall effects of DMBA on ovarian folliculogenesis are well known, little is known about the exact molecular mechanisms behind its ovotoxicity. In this study, we characterized the mechanisms behind DMBA-induced ovotoxicity in immature follicles. Microarray analysis of neonatal mouse ovaries exposed to DMBA in vitro revealed a multilayered mechanism of DMBA-induced neonatal ovotoxicity involving a distinct cohort of genes and ovarian signaling pathways primarily associated with follicular atresia, tumorigenesis, and follicular growth. Histomorphological and immunohistological analysis supported the microarray data, showing evidence of primordial follicle activation and preantral follicle atresia both in vitro and in vivo. Further immunohistological analysis identified increased Akt1 phosphorylation, mTOR activation, and decreased FOXO3a expression in DMBA-treated primordial oocytes. Our results reveal a novel mechanism of DMBA-induced preantral ovotoxicity involving selective immature follicle destruction and primordial follicle activation involving downstream members of the PI3K/Akt and mTOR signaling pathways.