Anxiety can be one of the most miserable and incapacitating of all the low testosterone symptoms. For reasons I explain in my My Personal Health Story, I am pretty sure that I have been low testosterone all of my adult life. And I can remember thinking after my first testosterone injection, "Wow! So this is what it feels like to be a normal person!" Testosterone has a profound effect on the male brain - you can read more about it in my link on Testosterone and the Brain actually - and I felt it in an unbelievable way. I was always a pretty high anxiety person prior to going on Testosterone Cypionate Injections and it was T that finally came to the rescue. My manager, who still does not know I am on HRT of course, even commented on how much better I was doing.
And I am not alone. One of the most common complaints of men with low testosterone on the Peak Testosterone Forum is anxiety. This is just one of the reasons that it is so cruel for physicians to ignore men with low testosterone and say, "It's all in your head" or "you're testosterone is fine" The reality is that the anxiety can be incapacitating. Look at how much these guys are suffering with it:
"Im not sure were to start but here we go, and forgive me if it get lengthy, but I feel it's important to see the whole picture. I am 39 years old and have been suffering from anxiety, depresion to one degree or another since 1999. Up until that point I had never had any issues with anxiety/depression. I was healthy fit and vibrant, and loving life."  (NOTE: His testosterone levels were a very low 221 ng/dl!)
"I have suffered from anxiety for 11 years. I have tried almost every mental health drug out there and Benzos, nothing works except I get a heap of side effects. I am currently on Klonopin 1.0mg per day, Valium 11mg per day and Citalopram (Celexa) 40mg per day. I still cant lead a normal life. I feel tired, irritable, very low sex drive, poor erections, abdominal weight gain, poor concentration etc. I asked my Dr for my Testosterone levels to be checked, they came back at 8.5 (Levels range from 7.8-35.5) which is around 210 in the States (I am in the UK) so they are very very low." 
"I started to have a little anxiety when I was 30 years old. It was mild and started from really no where that I could think of. I went to the Dr and had my blood work done. That was when I first noticed I had low T. My T then was around 222 to 250. I didn't do anything about it and lived my life. I am now 43 yrs old and still have low t. My anxiety got a little worse, still on the mild side. I started weekly injections a few weeks ago of Cypionate and I have made an appointment to see Dr. Shippen in Feb. I was wondering if the low t and the anxiety have anything in common?" 
So how do we know that low testosterone can cause or worsen anxiety? Well, of course, one obvious signpost is the fact that so many patients report it as a symptom. Plus, many men like me, are significantly helped once on HRT. Researchers were clued in with other lines of evidence as well. For example, prostate cancer patients, who usually undergo androgen blockers, often have increased anxiety.  And animal studies were showing that low testosterone causes anxiety. 
When they looked at it in human studies, there were a few that showed the opposite however. Nevertheless, many studies did still indicate the relation between hypogonadism and being anxious and we outline some of them below by year:
1999. One set of researchers finally admitted that anxiety was one of the hallmark symptoms of low testosterone in men with andropause, i.e. low testosterone that occurs as a normal part of aging.  What is interesting is that the researchers would not endorse HRT as a cure, partial or otherwise, for anxiety: "Most studies to date focused on physical benefits of testosterone replacement and failed to assess psychological symptoms rigorously. Preliminary data suggest that therapy may benefit elderly men with new-onset depression." So low T can cause anxiety but giving men testosterone won't fix it? This was a strange response, but it was followed up with similar conclusions.
2000. Contradicting the above was a case study of a high-anxiety young male, a 34-year-old, with "mental exhaustion, irritability, insomnia, poor concentration, and decreased libido."  His doc had tried relaxation techniques and medications, but nothing seemed to help. And no wonder as his testosterone was a nasty 185 ng/dl! So they put him on 200 mg injections and - lo and behold! - the patient experienced a miraculous recovery. Of course, there were many such similar stories from men on HRT, but notice that this study almost expressed shock that testosterone could do this and stated "with this case report, we suggest including anxiety in the list of psychiatric manifestations of hypogonadism that improve with testosterone replacement therapy."
2003. A few years later a study looked at testosterone and anxiety in young males and found that "for boys, lower levels of testosterone and testosterone levels that decreased more slowly across the day were related to higher levels of anxietyâ€“depression and attention problems." 
2003. Yet another study mentioned that anxiety is a standard symptom in men over 50 with low testosterone.  So far so good. However, then the researchers, in spite of studies #1-3 above, were very cautious and wrote that "the relationship between andropause and psychological symptoms such as depression is far from clear." We think that studies #1-3 are pretty clear!
Unfortunately, the current state of affairs is, as far as I know, that no researchers are advocating testosterone therapy as an anxiety cure or help in hypogonadal men. Perhaps this will change in time as it did for depression. )
In the meantime, additional evidence for the testosterone-to-anxiety link as science has uncovered many means of "biological plausability", i.e. actual physiological ways that giving a low T man HRT decreases anxiety. Here are a few examples:
1. DHT in the Hippocampus. Researchers found that in rats, it was DHT (or a related metabolite) that actually was the cause of reduced anxiety.  Of course, DHT is converted from testosterone in the male and so this is why increasing testosterone lowers anxiety. The researchers noted that the rats with reduced anxiety were more "exploratory". In other words, as anxiety goes down, creativity can increase. This is going to be good for your career and relationships.
2. Decreased Fear. Although fear is considered a little different psychological animal than anxiety, it is obviously a related characteristic. And, in general, as testosterone increases, fear is reduced.  '
3. Reduced Amygdala Activity. The amygdala is the key area of the brain involved in your fight or flight response and reacting to fearful situations. Testosterone has been found in several studies to dampen the activity of the amygdala to fearful situations and thus is an anxiety tonic under certain circumstances. 
So if low testosterone is a cause of anxiety, does testosterone always cure anxiety? Of course not. It doesn't take much thought to come up with many different reasons for heightened anxiety, including past trauma, elevated adrenal hormones such as cortisol, chronic stress, major life events or even a bad mother-in-law or evil boss. To really heal anxiety, it is important to take a holistic approach that looks at a multi-pathed solution.
WARNING: High estradiol can cause anxiety and other similar symptoms in men. If you are on HRT, make sure your doctor monitors and manages your estradiol levels. Some men get no relief from HRT and this is one of the more common reasons why.
4) Development and Psychopathology, June 2003, 2:431-449"Salivary testosterone diurnal variation and psychopathology in adolescent males and females: Individual differences and developmental effects"
5) International Journal of Impotence Research, 2008, 20:157â€“161; "Hypogonadism is associated with overt depression symptoms in men with erectile dysfunction"
6) Hormones and Behavior, Dec 2002, 42(4):448â€“460, "Testosterone Rapidly Reduces Anxiety in Male House Mice (Mus musculus)"
8) Pharmacotherapy: The Journal of Human Pharmacology and Drug Therapy, Aug 1999, 19(8):951-956, "Testosterone and Andropause: The Feasibility of Testosterone Replacement Therapy in Elderly Men"
9) Ann Endocrinol (Paris), 2003 Apr;64(2):162-9, "[Testosterone and depression in men aged over 50 years. Andropause and psychopathology: minimal systemic work-up"
10) J Clin Psychiatry, 2002 Dec, 63(12):1096-101, "Testosterone therapy in late-life major depression in males"
11) Psychoneuroendocrinology, Jun 2005, 30(5):418â€“430, "Testosterone's anti-anxiety and analgesic effects may be due in part to actions of its 5Î±-reduced metabolites in the hippocampus"
12) Biological Psychiatry, May 2006, 59(9):872â€“874, "A Single Administration of Testosterone Reduces Fear-Potentiated Startle in Humans"
13) Psychoneuroendocrinology, Jun 2009, 34(5):687â€“693, "Amygdala activity to fear and anger in healthy young males is associated with testosterone"