The amplified in breast cancer-3 (AIB3, ASC-2, RAP250, PRIP, TRBP, NRC, or NcoA6) gene is characterized as a cancer-amplified transcriptional coactivator for nuclear receptors, which include the peroxisome proliferator-activated receptor gamma (PPARgamma). To assess its biological function, we deleted the AIB3 gene in mice by homologous recombination. AIB3(+/-) mice are developmentally normal and fertile. AIB3(-/-) embryos exhibit growth restriction and lethality during 9.75-11.5 days postconception. The embryonic lethality is probably attributed to defects in the development of the placental vascular network and cardiac hypoplasia. These defects include the failure of labyrinthine development, the dilation of maternal blood sinuses, the massive erythrophagocytosis by trophoblasts, the alteration of trophoblast populations, and the lower proliferation of myocardium, which are similar to those encountered in mice lacking PPARgamma or the PPARgamma-binding protein (PBP, TRAP220, or DRIP205). In addition, the transcriptional activities of PPARgamma are significantly affected in mouse embryonic fibroblasts lacking AIB3. These results suggest that AIB3 is required for PPARgamma function in placental development and for normal heart development. These results also indicate that the biological function of AIB3 is not redundant with other classes of nuclear receptor coactivators such as PBP and members of the steroid receptor coactivator family.