FOXP3-expressing T regulatory lymphocytes (Tregs) have been described as putative mediators of immune tolerance, and thus facilitators of tumor growth. When found in association with various malignancies, Tregs are generally markers of poor clinical outcome. However, it is unknown whether they are also associated with cancer progression. We evaluated quantitative FOXP3 expression in lymphocytes as well as in epithelial cells in a set of thirty-two breast tumors with synchronous normal epithelium, ductal carcinoma in situ (DCIS), and invasive ductal carcinoma (IDC) components. Tumors were stained for FOXP3 and CD3 expression and Tregs quantified by determining the ratio of colocalized FOXP3 and CD3 relative to 1) total CD3-expressing lymphocytes and 2) to FOXP3-expressing epithelial cells. The median proportion of FOXP3-expressing CD3 cells significantly increased with malignant progression from normal to DCIS to IDC components (0.005, 0.019 and 0.030, respectively; p ≤ 0.0001 for normal vs. IDC and p = 0.004 for DCIS vs. IDC). The median intensity of epithelial FOXP3 expression was also increased with invasive progression and most markedly augmented between normal and DCIS components (0.130 vs. 0.175, p ≤ 0.0001). Both Treg infiltration and epithelial FOXP3 expression were higher in grade 3 vs. grade 1 tumors (p = 0.014 for Tregs, p = 0.038 for epithelial FOXP3), but did not vary significantly with hormone receptor status, size of invasive tumor, lymph node status, or disease stage. Notably, Treg infiltration significantly correlated with epithelial up-regulation of FOXP3 expression (p = 0.013 for normal, p = 0.001 for IDC). These findings implicate both Treg infiltration and up-regulated epithelial FOXP3 expression in breast cancer progression.