Human endometrial stromal (ES) cells in culture express PRL, a marker of decidualization, in response to sustained activation of protein kinase A (PKA). Cotreatment with the progestin medroxyprogesterone acetate (MPA) enhanced decidual PRL gene activation in the presence of elevated intracellular cAMP levels. This synergy became apparent, at protein and promoter level, after a lag period of 2 days and increased in a time-dependent manner thereafter. Pretreatment with cAMP advanced the time at which synergy between cAMP and MPA was apparent, suggesting that PKA activation sensitized ES cells to the effects of progestins. Analysis of the progesterone receptor (PR) indicated that PR-A was the predominant form in differentiating ES cells, but its abundance decreased markedly during the course of the decidualization response. The decline in PR levels was of functional relevance, as expression of PR-B or PR-A, by transient transfection, dramatically inhibited the activity of a decidual PRL promoter-reporter construct in response to cAMP. Furthermore, the expression of endogenous PRL protein in response to cAMP or cAMP plus MPA was substantially decreased by constitutive expression of green fluorescence protein-tagged PR, which was localized in the nucleus even in the absence of added ligand. Ligand-independent PR inhibition of the decidual PRL promoter was receptor specific, independent of known PR phosphorylation sites, and required minimally a functional DNA-binding domain. Transient expression of steroid receptor coactivator-1e (SRC-1e), but not SRC-1a, allowed synergy between cAMP and MPA without the requirement of sensitization by pretreatment with cAMP. This raised the possibility that SRC-1e was a component of cAMP-dependent sensitization of ES cells, but there was no evidence of altered messenger RNA expression of either SRC-1 isoform during decidualization. In conclusion, cellular PR levels determine the onset of the decidualization response. Initiation of this process requires elevated intracellular cAMP levels that sensitize ES cells to the actions of progestins through down-regulation of cellular PR levels and possibly via modulation of function of an intermediate factor(s) such as SRC-1e.