Testosterone is naturally converted in the body to a related sex hormone, dihydrotestosterone (DHT).
This stimulates the growth of facial and body hair, as well as acting on the prostate gland.
The new discovery could help researchers looking for ways to treat inherited male hair loss.
One of the scientists, Dr Tim Spector, of King's College London, said: "Early prediction before hair loss starts may lead to some interesting therapies that are more effective than treating late stage hair loss."Colleague Dr Brent Richards, from Mc Gill University in Montreal, Canada, said: "We've only identified a causes.
This idea probably grew from the observation that eunuchs never became bald and, having being castrated, they didn't, of course, produce very much testosterone.