Many human breast tumors are driven by high intratumor concentrations of 17beta-estradiol that appear to be locally synthesized. The role of aromatase is well established, but the possible contribution of the steroid sulfatase (STS), which liberates estrogens from their biologically inactive sulfates, has been inadequately assessed and remains unclear. To evaluate the role of STS further, we transduced estrogen-dependent MCF-7 human breast cancer cells with a retroviral vector directing the constitutive expression of the human STS gene. Gene integration was confirmed by Southern hybridization, production of the appropriately sized messenger RNA by Northern hybridization, and expression of functional protein by metabolism of [(3)H]estrone sulfate to [(3)H]estrone. Maximum velocity estimates of estrone formation are 64.2 pmol estrone/mg protein.h in STS-transduced cells (STS Clone 20), levels comparable to those seen in some human breast tumors. Lower levels of endogenous activity are seen in MCF-7 cells (13.0 pmol estrone/mg protein.h) and in cells transduced with vector lacking the STS gene (Vector 3 cells; 12.0 pmol estrone/mg protein.h). 17beta-Estradiol sulfate induces expression of the progesterone receptor messenger RNA only in STS Clone 20 cells, whereas estrone sulfate produces the greatest stimulation of anchorage-independent growth in these cells. STS Clone 20 cells retain responsiveness to antiestrogens, which block the ability of estrogen sulfate to increase the proportion of cells in both the S and G(2)/M phases of the cell cycle. Consistent with these in vitro observations, only STS Clone 20 cells exhibit a significant increase in the proportion of proliferating tumors in nude ovariectomized mice supplemented with 17beta-estradiol sulfate. The primary activity in vivo appears to be from intratumor STS, rather than hepatic STS. Surprisingly, 17beta-estradiol sulfate appears more effective than 17beta-estradiol when both are administered at comparable concentrations. This effect, which is seen only in STS Clone 20 cells, may reflect differences in the cellular pharmacology of exogenous estrogens compared with those released by the activity of intracellular STS. These studies directly demonstrate that intratumor STS activity can support estrogen-dependent tumorigenicity in an experimental model and may contribute to the promotion of human breast tumors.