Steroid receptor coactivator 3 (SRC-3, AIB1 or ACTR) is a transcriptional coactivator for nuclear receptors and certain other transcription factors such as E2F1. SRC-3 is overexpressed in breast cancers and its overexpression is sufficient to cause mammary carcinomas in vivo. However, the mechanisms controlling endogenous SRC-3 overexpression are unknown. In this study, we identified the first exon and analyzed the 5' regulatory sequence of the SRC-3 gene. We found three evolutionarily conserved regions (ECRs) in the 5' SRC-3 regulatory sequence and ECR2 makes a major contribution to the SRC-3 promoter activity. The ECR2 region (bp -250/+350) contains several Sp1 binding sites and two E2F1 binding sites. We show that E2F1 can significantly activate the ECR2 promoter activity in a dose dependent manner. Furthermore, overexpression of E2F1 significantly increases the promoter activity of the endogenous SRC-3 gene and boosts SRC-3 expression in vivo. Conversely, knockdown of E2F1 reduces SRC-3 expression. We demonstrate that the mechanism of E2F1 activity on SRC-3 promoter is independent of the E2F binding sites, but relies on the Sp1 element located at bp +150/+160. Sp1, E2F1 and SRC-3 are specifically recruited to this Sp1 site and the interaction between E2F1 and Sp1 is essential to modulate SRC-3 expression. Moreover, SRC-3 coactivates E2F1 activity and thereby additively stimulates a further increase in SRC-3 expression in vivo. These results suggest that in cells with hyperactive E2F1, such as the case encountered in breast cancer cells, there is a positive feedback regulatory loop consisting of E2F1 and SRC-3 to maintain high levels of SRC-3 and E2F1 activity, which may partially interpret the oncogenic role of SRC-3 overexpression.