ErbB1 and ErbB2 receptors are well-characterized targets for anticancer drugs, but the clinical relevance of the related ErbB4 receptor is unknown. Here, we have assessed the clinical significance of the proteolytically cleavable ErbB4 isoforms in breast cancer patients and investigated their functions in vitro. The expression of transcripts encoding the cleavable ErbB4 isoforms associated with estrogen receptor-alpha (ER) expression (P < 0.001) and a high histologic grade of differentiation (P </= 0.002) in real-time reverse transcription-PCR analysis of 62 breast cancer samples. Despite high ErbB4 mRNA expression levels in a subset of samples, ErbB4 gene amplification was not observed. High ErbB4 protein expression levels, as assessed by immunohistochemistry, associated with a favorable outcome in ER-positive cases from a series of 458 breast cancer patients (P = 0.01), whereas no association between ErbB4 expression and survival was found among women with ER-negative cancer (P = 0.86). However, nuclear ErbB4 immunoreactivity was associated with poor survival as compared with women whose cancer had membranous ErbB4 staining (P = 0.04). In vitro, overexpression of a cleavable ErbB4 isoform in ER-positive breast cancer cells resulted in translocation of a proteolytically released intracellular ErbB4 receptor fragment into the nucleus, as well as, enhanced proliferation, anchorage-independent growth, and estrogen response element-mediated transcriptional activity. These results suggest that the association of ErbB4 expression with clinical outcome is dependent on the subcellular localization of ErbB4 and that a proteinase-cleavable ErbB4 isoform promotes growth of ER-positive breast cancer and enhances ER-mediated gene transcription.