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Social animals must cope with challenges and opportunities by adjusting how they react to a salient stimulus. Here we use California mice (Peromyscus californicus) and investigate the mechanisms underlying social decision-making by studying (i) rapid effects of testosterone (T) pulses on a male's decisions to approach a novel male (challenge) versus a receptive female (opportunity), and (ii) whether social experience shapes how such effects are manifested. In Experiment 1, we found that sexually naïve males administered saline injections preferentially approached unfamiliar females over unfamiliar males, in contrast, 10 min after receiving a single T-injection, males expressed a preference for approaching unfamiliar males. Such an effect of T only occurred in sexually naïve males, but not pair-bonded males, suggesting that the rapid effects of T on approach behavior may rely on the pair-bonding experiences. Experiment 2 investigated social decision-making across three repeated exposures to the challenge/opportunity situations. Only the initial decision, approach to the challenge, predicted future aggressive behaviors, and such an effect relied on the rapid actions of T. We also found that experience with the controlled challenge situation (the male intruder was restrained behind a wire mesh) dampened the approach to the male side (potential threat) when later exposed to the same conditions. This suggests that a resident's motivation to defend against a threatening individual may decrease as the threat posed by the "neighbors" is reduced. Overall rapid effects of post-encounter T pulses may play important roles in influencing behavioral decisions during social interactions. • Unpaired males approach unfamiliar females over unfamiliar males. • Testosterone (T) in unpaired males induces approach towards unfamiliar males over females. • Paired males approach unfamiliar males over females, independently of the T treatment. • Approach behavior can be altered through multiple testing. • Unpaired T-males that approached unfamiliar males displayed high future aggression. [ABSTRACT FROM AUTHOR]