BAG-1 is a multifunctional protein that interacts with a wide range of cellular targets including heat-shock proteins and some nuclear hormone receptors. BAG-1 exists as three major isoforms, BAG-1L, BAG-1M and BAG-1S. BAG-1L contains a nuclear localization signal, which is not present in the other isoforms, and is predominantly localized in the cell nucleus. Here we have investigated the effects of BAG-1 on function of the oestrogen receptor (ER), a key growth control molecule and target for hormonal therapy in breast cancer. We demonstrate that BAG-1L, but not BAG-1S or BAG-1M, increased oestrogen-dependent transcription in breast cancer cells. BAG-1L interacted with and stimulated the activity of both ER alpha and beta. Although BAG-1L and ERs colocalize to the nucleus, fusing BAG-1S to an heterologous nuclear localization sequence was not sufficient to stimulate transcription. Consistent with an important effect on receptor function, nuclear BAG-1 expression in breast cancers was associated with expression of the progesterone receptor, a transcriptional target of ERalpha, and was associated with improved survival in patients treated with hormonal therapy. These data suggest that BAG-1L is an important determinant of ER function in vitro and in human breast cancer.