Many transcription factors undergo transcription-coupled proteolysis. Although ligand binding activates ubiquitin proteolysis of estrogen receptor α (ERα), mechanisms governing this and its relationship to transcriptional activation were unclear. Data presented link cross talk between the Src kinase and liganded ERα with ERα activation and its ubiquitylation. Liganded ERα rapidly activates and recruits Src, which phosphorylates ERα at tyrosine 537 (Y537). This enhances ERα binding to the ubiquitin ligase/ERα coactivator, E6-associated protein (E6-AP), stimulating ERα ubiquitylation, target gene activation, and ultimately ERα loss. ERα phosphorylation by Src promotes ERα ubiquitylation by E6-AP and proteasomal degradation in vitro. Src inhibition impairs estrogen (E2)-activated ERα:E6-AP binding, reducing ERα degradation. ERα-Y537F shows little E2-stimulated degradation and activates native ERα target genes poorly. Src activation enhances ERα and E6-AP binding and their occupancy at ERα target gene promoters to enhance transcription. Thus, ERαY537 phosphorylation drives ERα:E6-AP binding to at least a subset of target promoters, linking transcriptional activation to ERα degradation and providing a novel mechanism to fine tune ERα action. The observation that ERα transcriptional activity can be briskly maintained in a context of reduced ERα levels raises the possibility that hormonally sensitive tissues may not always show robust ERα protein levels.