Steroid hormone receptors, including estrogen receptor-alpha (ERalpha), are ligand-activated transcription factors, and hormone binding leads to depletion of receptor levels via preteasome-mediated degradation. NEDD8 (neural precursor cell-expressed developmentally down-regulated) is an ubiquitin-like protein essential for protein processing and cell cycle progression. We recently demonstrated that ubiquitin-activating enzyme (Uba)3, the catalytic subunit of the NEDD8-activating enzyme, inhibits ERalpha transcriptional activity. Here we report that Uba3-mediated inhibition of ERalpha transactivation function is due to increased receptor protein turnover. Coexpression of Uba3 with ERalpha increased receptor degradation by the 26S proteasome. Inhibition of NEDD8 activation and conjugation diminished polyubiquitination of ERalpha and blocked proteasome-mediated degradation of receptor protein. The antiestrogen ICI 182,780 is known to induce ER degradation. In human MCF7 breast cancer cells modified to contain a disrupted NEDD8 pathway, ICI 182,780 degradation of ERalpha was impaired, and the antiestrogen was ineffective at inhibiting cell proliferation. This study provides the first evidence linking nuclear receptor degradation with the NEDD8 pathway and the ubiquitin-proteasome system, suggesting that the two pathways can act together to modulate ERalpha turnover and cellular responses to estrogens. Based on our observation that an intact NEDD8 pathway is essential for the antiproliferation activity of the ICI 182,780 in ERalpha positive breast cancer cells, we propose that disruptions in the NEDD8 pathway provide a mechanism by which breast cancer cells acquire antiestrogen resistance while retaining expression of ERalpha.