To understand the mechanism of retinoid resistance, we studied the subcellular localization and function of retinoid receptors in human breast cancer cell lines. Retinoid X receptor alpha (RXR alpha) localized throughout the nucleoplasm in retinoid-sensitive normal human mammary epithelial cells and in retinoid-responsive breast cancer cell line (MCF-7), whereas it was found in the splicing factor compartment (SFC) of the retinoid-resistant MDA-MB-231 breast cancer cell line and in human breast carcinoma tissue. In MDA-MB-231 cells, RXR alpha was not associated with active transcription site in the presence of ligand. Similarly, ligand-dependent RXR homo- or heterodimer-mediated transactivation on RXR response element or RARE showed minimal response to ligand in MDA-MB-231 cells. Infecting MDA-MB-231 cells with adenoviral RXR alpha induced nucleoplasmic overexpression of RXR alpha and resulted in apoptosis upon treatment with an RXR ligand. This suggests that nucleoplasmic RXR alpha restores retinoid sensitivity. Epitope-tagged RXR alpha and a C-terminus deletion mutant failed to localize to the SFC. Moreover, RXR alpha localization to the SFC was inhibited with RXR alpha C-terminus peptide. This peptide also induced ligand-dependent transactivation on RXRE. Therefore, the RXR alpha C terminus may play a role in the intranuclear localization of RXR alpha. Our results provide evidence that altered localization of RXR alpha to the SFC may be an important factor for the loss of retinoid responsiveness in MDA-MB-231 breast cancer cells.