The serine protease inhibitor, elafin, is a critical component of the epithelial barrier against neutrophil elastase (NE). Elafin is downregulated in the majority of breast cancer cell lines compared with normal human mammary epithelial cells (HMECs). Here, we evaluated the role of elafin and NE on proliferation and tumorigenesis. Elafin is induced in growth factor-deprived HMECs as they enter a quiescent (G0) state, suggesting that elafin is a counterbalance against the mitogenic effects of NE in G0 HMECs. Stable knockdown of elafin compromises the ability of HMECs to maintain G0 arrest during long-term growth factor deprivation; this effect can be reversed by re-expression of wild-type elafin but not elafin-M25G lacking protease inhibitory function. These results suggest that NE, which is largely contributed by activated neutrophils in the tumor microenvironment, may be negatively regulating the ability of elafin to arrest cells in G0. In fact when purified NE was added to elafin-knocked down HMECs, these cells demonstrated greater sensitivity to the growth-promoting effects of purified NE. Activation of ERK signaling, downstream of toll-like receptor 4, was essential to the mitogenic effect of NE on HMECs. These findings were next translated to patient samples. Immunohistochemical analysis of normal breast tissue revealed robust elafin expression in the mammary epithelium; however, elafin expression was dramatically downregulated in a significant proportion of human breast tumor specimens. The loss of elafin expression during breast cancer progression may promote tumor growth as a consequence of increased NE activity. To address the role of NE in mammary tumorigenesis, we next examined whether deregulated NE activity enhances mammary tumor growth. NE knockout in the C3(1)TAg mouse model of mammary tumorigenesis suppressed proliferation and reduced the kinetics of tumor growth. Overall, the imbalance between NE and its inhibitors, such as elafin, presents an important therapeutic target in breast cancer.