Recent advances in molecular genetics have brought us closer to answering the question as to which mechanisms are used by steroid hormone receptors to control transcription. While binding to specific response elements in the promoter and enhancer regions of many genes has for a long time been considered as the major mode of action, a growing number of alternative transcriptional control mechanisms have been identified in the last couple of years. With the recent finding that DNA binding of the glucocorticoid receptor is not essential for survival, mechanisms depending on cross-talk with other transcription factors through protein-protein interactions have gained attention. In this mini-review, we will discuss the roles of DNA binding-dependent and -independent transcriptional modes of action in development and physiology as exemplified by the analysis of glucocorticoid receptor function.