The glucocorticoid receptor (GR) and the tumor supressor p53 mediate different stress responses. We have studied the mechanism of their mutual inhibition in normal endothelial cells (HUVEC) in response to hypoxia, a physiological stress, and mitomycin C, which damages DNA. Dexamethasone (Dex) stimulates the degradation of endogenous GR and p53 by the proteasome pathway in HUVEC under hypoxia and mitomycin C treatments, and also in hepatoma cells (HepG2) under normoxia. Dex inhibits the functions of p53 (apoptosis, Bax, and p21 WAF1/CIP1 expression) and GR (PEPCK and G-6-Pase expression). Endogenous p53 and GR form a ligand-dependent trimeric complex with Hdm2 in the cytoplasm. Disruption of the p53-HDM2 interaction prevents Dex-induced ubiquitylation of GR and p53. The ubiquitylation of GR requires p53, the interaction of p53 with Hdm2, and E3 ligase activity of Hdm2. These results provide a mechanistic basis for GR and p53 acting as opposing forces in the decision between cell death and survival. The development of most tumors is associated with loss of function of the tumor suppressor p53. Different physiological stress, including DNA damage and hypoxia, activate p53. p53 is a transcription factor that regulates genes involved in growth arrest and apoptosis. p53 is down-regulated by its target gene product Mdm2 (human homolog Hdm2). Mdm2 forms an autoregulatory loop with p53 by binding to its N-terminal domain, inhibiting its transcriptional activity and increasing its degradation by the ubiquitin proteasome pathway (for reviews, see Jimenez et al. 1999;Lakin and Jackson 1999;Sionov and Haupt 1999). Mdm2 is a RING finger-dependent ubiquitin protein ligase for p53 and itself (Argentini et al. 2000;Fang et al. 2000;Honda and Yasuda 2000). Mdm2 also inhibits p53 by nuclear export through a mechanism involving either the nuclear export signal (NES) of Mdm2 (Tao and Levine 1999) or the RING finger of Mdm2 and the NES of p53 (Boyd et al. 2000;Geyer et al. 2000). The NES of p53 is masked in the transcriptionally active heterodimer, but is exposed in the monomeric form of p53 ). MdmX, a Mdm2 homolog that lacks a NES, stabilizes p53 by retention in the nucleus (Jackson and Berberich 2000;Stad et al. 2000). Nuclear p53 levels can also be maintained by ARF, which blocks nucleo-cytoplasmic shuttling of Mdm2 (Sherr and Weber 2000). Most studies of p53 involve DNA damaging drugs and radiation. Much less is known about the physiological stress, hypoxia. Under hypoxic conditions, p53 is stabilized by mitochondria through a redox-dependent mechanism (Chandel et al. 2000) and by HIF-1␣ , whereas p53 induces degradation of HIF-1␣ (Ravi et al. 2000). The response to hypoxia in vivo also involves the glucocorticoid receptor (GR) (Bauer et al. 1999).GR is a member of the steroid receptor superfamily that mediates physiological processes controlled by glucocorticoids. In the unbound state GR is located in the cytoplasm bound to chaperones. Upon ligand binding the chaperones dissociate, exposing the NLS that enables GR to enter the n...