Extracellular hormones, growth factors or cytokines relay their effects on the transcription of genes through the recognition of specific receptors and intracellular signaling molecules. Stat (signal transducers and activators of transcription) have been recognized as crucial intracellular signaling molecules. The cytokine receptor associated Jak kinases convert the latent monomeric form of the Stat molecules to the activated dimeric form through tyrosine phosphorylation. The dimers bind to specific DNA response elements and are able to induce transcription. The transcription factor Stat5 is a central determinant of mammary gland development and function. It is activated during pregnancy by prolactin and contributes to the growth and alveolar differentiation of the epithelial cells. During lactation it governs milk protein gene expression and contributes to cell survival. Negative regulatory potential is exerted by the expression of the short form of the molecule, lacking the transactivation domain, but associating with nuclear co-repressors. This form is activated through tyrosine phosphorylation and dimerisation similarly to the full-length form, but is impeded in dephosphorylation and co-activator recruitment. Positive enhancement of Stat5 transactivation potential is provided by the glucocorticoid receptor (GR). Ligand activation of the receptor causes complex formation with Stat5 and deviation to the Stat5 DNA binding site. An additional regulatory loop is provided by the reactivation of the short form of Stat5 through GR association.