Estrogens have been implicated in the regulation of prolactin gene expression in man, although previous studies have not defined the molecular mechanism whereby estradiol activates the human prolactin gene promoter (hPrl). We found that estradiol induced a reproducible 1.8-fold activation of the hPrl gene promoter, using pituitary GH3 cells stably transfected with a 5000bp hPrl promoter fragment linked to luciferase reporter gene. This activation was blocked by treatment with ER antagonists 4-hydroxytamoxifen and ICI-182,780. Promoter deletion and mutagenesis experiments identified a functional Estrogen response element (ERE) sequence 1189bp upstream of the transcription start site that was responsible for estrogen mediated promoter activation. This site differed from the consensus ERE sequence by two base pairs, one in each half site. This ERE was identified to be functional through binding ER in electrophoretic mobility shift assays. ChIP assays confirmed ER binding to this sequence in vivo in the absence of ligand, with increased recruitment when cells were cultured in the presence of estradiol. When cells were treated with both estradiol and TNF we observed synergistic activation of the hPrl promoter, which was mediated by the -1189bp ERE. Mutagenesis of this ERE abolished the promoter activating effect not only of estradiol, but also that of TNF. These data suggest a novel, promoter specific signaling interaction between estrogen and TNF signaling, which is likely to be important for prolactin regulation in vivo.