Transcription factor RUNX3 is inactivated in a number of malignancies, including breast cancer, and is suggested to function as a tumor suppressor. How RUNX3 functions as a tumor suppressor in breast cancer remains undefined. Here, we show that about 20% of female Runx3(+/-) mice spontaneously developed ductal carcinoma at an average age of 14.5 months. Additionally, RUNX3 inhibits the estrogen-dependent proliferation and transformation potential of ERα-positive MCF-7 breast cancer cells in liquid culture and in soft agar and suppresses the tumorigenicity of MCF-7 cells in severe combined immunodeficiency mice. Furthermore, RUNX3 inhibits ERα-dependent transactivation by reducing the stability of ERα. Consistent with its ability to regulate the levels of ERα, expression of RUNX3 inversely correlates with the expression of ERα in breast cancer cell lines, human breast cancer tissues and Runx3(+/-) mouse mammary tumors. By destabilizing ERα, RUNX3 acts as a novel tumor suppressor in breast cancer.