In the present study, we investigated the involvement of protein degradation via the 26S proteasome during progesterone receptor (PR)-mediated transcription in T-47D cells containing a stably integrated MMTV-CAT reporter construct (CAT0 cells). Progesterone induced CAT and HSD11beta2 transcription while co-treatment with the proteasome inhibitor, MG132, blocked PR-induced transcription in a time-dependent fashion. MG132 treatment also inhibited transcription of beta-actin and cyclophilin, but not two proteasome subunit genes, PSMA1 and PSMC1, indicating that proteasome inhibition affects a subset of RNA polymerase II (RNAP(II))-regulated genes. Progesterone-mediated recruitment of RNAP(II) was blocked by MG132 treatment at time points later than 1 h that was not dependent on the continued presence of PR, associated cofactors, and components of the general transcription machinery, supporting the concept that proteasome-mediated degradation is needed for continued transcription. Surprisingly, progesterone-mediated acetylation of histone H4 was inhibited by MG132 with the concomitant recruitment of HDAC3, NCoR, and SMRT. We demonstrate that the steady-state protein levels of SMRT and NCoR are higher in the presence of MG132 in CAT0 cells, consistent with other reports that SMRT and NCoR are targets of the 26S proteasome. However, inhibition of histone deacetylation by trichostatin A (TSA) treatment or SMRT/NCoR knockdown by siRNA did not restore MG132-inhibited progesterone-dependent transcription. Therefore, events other than histone deacetylation and stability of SMRT and NCoR must also play a role in inhibition of PR-mediated transcription.