New World primates (NWPs) exhibit a compensated form of resistance to gonadal steroid hormones. We demonstrated recently that estrogen resistance in NWP cells was associated with the overexpression of two proteins, a nonreceptor-related, dominant-negative-acting estrogen response element (ERE)-binding protein (ERE-BP) and an intracellular estradiol-binding protein (IEBP). Based on the N-terminal sequences of tryptic fragments of IEBP isolated from a 17beta-estradiol (E2) affinity column we cloned a full-length cDNA for IEBP from the estrogen-resistant NWP cell line, B95-8. Subsequent sequence analysis revealed 87% sequence identity between the deduced peptide for IEBP and human Hsp27. When hormone-responsive, wild-type Old World primate (OWP) cells were transiently transfected with IEBP cDNA, E2-directed ERE reporter luciferase activity was reduced by 50% compared with vector only-transfected OWP cells (p < 0.0018). When IEBP and ERE-BP were cotransfected, ERE promoter-reporter activity was reduced by a further 60% (p < 0.0001). Electrophoresis mobility shift analyses showed that IEBP neither bound to ERE nor competed with the estrogen receptor (ER) for binding to ERE. However, there was evidence of protein-protein interaction of IEBP and ERalpha; IEBP was coimmunoprecipitated with anti-ERalpha antibody in wild-type cells stably transfected with IEBP. A specific interaction between ERalpha and IEBP was confirmed in glutathione S-transferase pull-down and yeast two-hybrid assays. Data indicate that the Hsp27-related IEBP interacts with the ligand binding domain of the ERalpha. In summary, by inhibiting the ERalpha-E2 interaction, IEBP acts to squelch ERalpha-directed ERE-regulated transactivation and promote estrogen resistance in NWP cells.