The transcription factor GATA-3 is required for normal mammary gland development, and its expression is highly correlated with estrogen receptor α (ERα) in human breast tumors. However, the functional role of GATA-3 in ERα-positive breast cancers is yet to be established. Here, we show that GATA-3 is required for estradiol stimulation of cell cycle progression in breast cancer cells. The role of GATA-3 in estradiol signaling requires the direct positive regulation of the expression of the ERα gene itself by GATA-3. GATA-3 binds to two cis-regulatory elements located within the ERα gene, and this is required for RNA polymerase II recruitment to ERα promoters. Reciprocally, ERα directly stimulates the transcription of the GATA-3 gene, indicating that these two factors are involved in a positive cross-regulatory loop. Moreover, GATA-3 and ERα regulate their own expression in breast cancer cells. Hence, this transcriptional coregulatory mechanism accounts for the robust coexpression of GATA-3 and ERα in human breast cancers. In addition, these results highlight the crucial role of GATA-3 for the response of ERα-positive breast cancers to estradiol. Moreover, they identify GATA-3 as a critical component of the master cell-type–specific transcriptional network including ERα and FoxA1 that dictates the phenotype of hormone-dependent breast cancer. [Cancer Res 2007;67(13):6477–83]