Mediator recently has emerged as a central player in the direct transduction of signals from transcription factors to the general transcriptional machinery. In the case of nuclear receptors, in vitro studies have shown that the transcriptional coactivator function of the Mediator involves direct ligand-dependent interactions of the MED1 subunit, through its two classical LxxLL motifs, with the receptor AF2 domain. However, despite the strong in vitro evidence, there currently is little information regarding in vivo functions of the LxxLL motifs either in MED1 or in other coactivators. Toward this end, we have generated MED1 LxxLL motif-mutant knockin mice. Interestingly, these mice are both viable and fertile and do not exhibit any apparent gross abnormalities. However, they do exhibit severe defects in pubertal mammary gland development. Consistent with this phenotype, as well as loss of the strong ligand-dependent estrogen receptor (ER)alpha-Mediator interaction, expression of a number of known ERalpha-regulated genes was down-regulated in MED1-mutant mammary epithelial cells and could no longer respond to estrogen stimulation. Related, estrogen-stimulated mammary duct growth in MED1-mutant mice was also greatly diminished. Finally, additional studies show that MED1 is differentially expressed in different types of mammary epithelial cells and that its LxxLL motifs play a role in mammary luminal epithelial cell differentiation and progenitor/stem cell determination. Our results establish a key nuclear receptor- and cell-specific in vivo role for MED1 LxxLL motifs, through Mediator-ERalpha interactions, in mammary gland development.