Estrogen receptor alpha (ERα) is a ligand-dependent nuclear receptor that is important in breast cancer genesis, behavior and response to hormone-based therapies. A T7 phage display screen against full-length human ERα, coupled with genome-wide exon arrays, was used to identify RAC3 as a putative ERα co-regulator. RAC3 is a Rho family small GTPase that is associated with cytoskeletal rearrangement. We demonstrate a novel role for nuclear RAC3 as an ERα transcriptional activator, with prognostic implications for metastatic disease. Through in vitro and cell-based studies, RAC3 was shown to exist in a GTP-bound state and act as a ligand specific ERα co-activator of E2-induced transcription. Overexpression of RAC3 induced pro-growth and pro-migratory genes that resulted in increased migration of ERα-positive breast cancer cells. Chemical inhibition and genetic knockdown of RAC3 antagonized E2-induced cell proliferation, cell migration and ERα mediated gene expression, indicating that RAC3 is necessary for full ERα transcriptional activity. In agreement with the molecular and cellular data, RAC3 overexpression in ERα-positive breast cancers correlated with a significant decrease in recurrence free survival and a significant increase in the odds ratio of metastasis. In conclusion, RAC3 is a novel ERα co-activator that promotes cell migration and has prognostic value for ERα-positive breast cancer metastasis. RAC3 may also be a useful therapeutic target for ERα-positive breast cancers.