Agonist-mediated degradation of estrogen receptor ␣ (ER␣) has been associated with its transcriptional activity. However, the mechanism by which ER␣ is targeted for degradation and whether there is a direct functional link between ER␣ stability and ER␣-mediated transactivation have not been elucidated. Here we provide evidence that the p160 coactivator, AIB1, uniquely mediates agonist-induced, but not antagonist-induced, ER␣ degradation. We show that AIB1 recruitment by ER␣ is not only necessary but also sufficient to promote degradation. Suppression of AIB1 levels leads to ER␣ stabilization in the presence of 17-estradiol and, despite increased ER␣ levels, reduced recruitment of ER␣ to endogenous target gene promoters. In addition, association of RNA polymerase II with ER␣ target promoters is lost when AIB1 is suppressed, leading to inhibition of target gene transcription. AIB1 thus plays a dual role in regulating ER␣ activity, one in recruiting transcription factors including other coactivators involved in gene activation and the other in regulating ER␣ protein degradation mediated by the ubiquitin-proteosome machinery.E strogen plays a central role in the control of development, sexual behavior, and reproductive functions, and its effects have been linked to the progression of the majority of human breast cancers. The diverse biological effects of estrogen are mediated by two estrogen receptors (ERs), ER␣ and ER, which are members of the nuclear hormone receptor superfamily (1, 2). Upon 17-estradiol (E2) binding, ER undergoes a major conformational change, binds to its cognate DNA response element (ERE) located in the promoter͞enhancer regions of target genes, and regulates gene transcription (3). It is recognized that ER-mediated transcription is a highly complex process involving a multitude of coregulatory factors and ''cross talk'' among distinct signaling pathways (reviewed in ref. 4). The cofactors can be broadly divided into coactivators, which augment functions of activated receptors, and corepressors, which sustain the inactivated state of receptors (reviewed in ref. 5). The coactivators enhance receptor activity by modulating chromatin state through recruitment of ATPdependent chromatin remodeling complexes and modification of the histones by methyltransferases and acetyltransferases. The p160 family of coactivators serves as platforms to recruit factors that have intrinsic enzymatic activities, whereas the DRIP͞TRAP͞SMCC complexes are ''mediator'' complexes bridging the receptor to the basal transcription machinery. We and others have demonstrated that these coactivators become recruited to target gene promoters by agonist-bound ER␣ in a dynamic fashion after a sequential order cycling on and off the promoter (6, 7).Cellular responses to E2 are highly controlled, involving regulation of the ER␣ level through transcriptional, posttranscriptional, and posttranslational mechanisms (8-10). E2 binding accelerates receptor degradation, reducing the half-life of the ER␣ protein from Ϸ5 days to Ϸ3-4 h (...