Steroid receptor RNA activator (SRA) is an RNA that coactivates steroid hormone receptor-mediated transcription in vitro. Its expression is strongly up-regulated in many human tumors of the breast, uterus, and ovary, suggesting a potential role in pathogenesis. To assess SRA function in vivo, a transgenic-mouse model was generated to enable robust human SRA expression by using the transcriptional activity of the mouse mammary tumor virus long terminal repeat. Transgenic SRA was expressed in the nuclei of luminal epithelial cells of the mammary gland and tissues of the male accessory sex glands. Distinctive evidence for SRA function in vivo was obtained from the elevated levels of estrogen-controlled expression of progesterone receptor in transgenic mammary glands. Although overexpression of SRA showed strong promoting activities on cellular proliferation and differentiation, no alterations progressed to malignancy. Epithelial hyperplasia was accompanied by increased apoptosis, and preneoplastic lesions were cleared by focal degenerative transformations. In bitransgenic mice, SRA also antagonized ras-induced tumor formation. This work indicates that although coactivation of steroid-dependent transcription by SRA is accompanied by a proliferative response, overexpression is not in itself sufficient to induce turmorigenesis. Our results underline an intricate relationship between the different physiological roles of steroid receptors in conjunction with the RNA activator in the regulation of development, tissue homeostasis, and reproduction.