Estrogens play an important role in normal physiology and in a variety of pathological states involving diverse tissues including breast and bone. The mechanism by which estrogens exert cell type- and disease-specific effects, however, remains to be explained. We have compared the gene expression profile of the MCF7 breast cancer cell line with that of the osteoblast-like cell line U2OS-ERalpha by expression microarrays. We find that fewer than 10% of the 17beta-estradiol (E2)-regulated genes are common to both cell types. We have validated this in primary calvarial osteoblasts. To dissect the mechanism underlying the cell type-specific E2 regulation of gene expression in MCF7 and U2OS-ERalpha cells, we compared the ERalpha binding sites on DNA in the two cell types by performing chromatin immunoprecipitation (ChIP) on genomic tiling arrays (ChIP-on-chip). Consistent with the distinct patterns of E2-regulated gene expression in these two cell lines, we find that the vast majority of ERalpha binding sites are also cell type specific and correlate both in position and number with cell type-specific gene regulation. Interestingly, although the forkhead factor FoxA1 plays a critical role in defining the ERalpha cistrome in MCF7 cells, it is not expressed in U2OS-ERalpha cells, and forkhead motifs are not enriched in the ERalpha cistrome in these cells. Finally, the ERalpha cistromes are correlated with cell type-specific epigenetic histone modifications. These results support a model for the cell type-specific action of E2 being driven primarily through specific ERalpha occupancy of epigenetically marked cis-regulatory regions of target genes.