Estrogen receptor ␣ (ER␣) signaling is paramount for normal mammary gland development and function and the repression of breast cancer. ER␣ function in gene regulation is mediated by a number of coactivators and corepressors, most of which are known to modify chromatin structure and/or influence the assembly of the regulatory complexes at the level of transcription initiation. Here we describe a novel mechanism of attenuating the ER␣ activity. We show that cofactor of BRCA1 (COBRA1), an integral subunit of the human negative elongation factor (NELF), directly binds to ER␣ and represses ER␣-mediated transcription. Reduction of the endogenous NELF proteins in breast cancer cells using small interfering RNA results in elevated ER␣-mediated transcription and enhanced cell proliferation. Chromatin immunoprecipitation reveals that recruitment of COBRA1 and the other NELF subunits to endogenous ER␣-responsive promoters is greatly stimulated upon estrogen treatment. Interestingly, COBRA1 does not affect the estrogen-dependent assembly of transcription regulatory complexes at the ER␣-regulated promoters. Rather, it causes RNA polymerase II (RNAPII) to pause at the promoter-proximal region, which is consistent with its in vitro biochemical activity. Therefore, our in vivo work defines the first corepressor of nuclear receptors that modulates ER␣-dependent gene expression by stalling RNAPII. We suggest that this new level of regulation may be important to control the duration and magnitude of a rapid and reversible hormonal response.[Keywords: Nuclear receptor; transcriptional repression; COBRA1; NELF; RNAPII; estrogen] Supplemental material is available at http://www.genesdev.org.