Breast cancer is the most common cancer in women, but its pathogenesis is still unclear. Microsatellite instability (MSI) has been identified in breast cancer cells, suggesting an association with mismatch repair defects. To test this hypothesis, we investigated MSI, protein expression of hMSH2 and hMLH1, as well as genetic and epigenetic modifications of these two genes in 32 sporadic breast tumors. MSI was identified in 15 cases. Immunohistochemistry analysis revealed that all MSI cases but one had lower than normal expression of hMSH2 (nine cases), hMLH1 (12 cases), or both (seven cases). In tumors with MSI, both genetic and epigenetic modifications of these mismatch repair genes were also identified. Eight cases harbored mutations or polymorphisms in hMSH2 and hMLH1, and 10 exhibited hypermethylation in the promoter region of hMLH1. These results suggest that both genetic and epigenetic alterations of hMSH2 and especially of hMLH1 contribute to genomic instability and tumorigenesis in sporadic breast cancer.