Multidrug resistance is a major barrier against successful chemotherapy, and this has been shown in vitro to be often caused by ATP-binding cassette (ABC) transporters. These transporters are frequently overexpressed in human cancers and confer an adverse prognosis in many common malignancies. The genetic factors, however, that initiate their expression in cancer are largely unknown. Here we report that the major multidrug transporter ABCG2 (BCRP/MXR) is directly and specifically activated by the transcription factor E2F1--a factor perturbed in the majority of human cancers. E2F1 regulates ABCG2 expression in multiple cell systems, and, importantly, we have identified a significant correlation between elevated E2F1 and ABCG2 expression in human lung cancers. We show that E2F1 causes chemotherapeutic drug efflux both in vitro and in vivo via ABCG2. Furthermore, the E2F1-ABCG2 axis suppresses chemotherapy-induced cell death that can be restored by the inhibition of ABCG2. These findings therefore identify a new axis in multidrug resistance and highlight a radical new function of E2F1 that is relevant to tumor therapy.