Extracts containing wild-type or mutant human estrogen receptor (ER) have been used to study the binding of ER to its responsive element (ERE). Estradiol (E2) or the antiestrogen hydroxytamoxifen is required for ER binding as assayed by gel retardation. The DNA binding domain (DBD) encompasses the highly conserved region C. Both intact ER-E2 complexes and ER mutants truncated for the hormone binding domain (HBD) bind as dimers to an ERE. However, an HBD-truncated ER binds less tightly to an ERE than an intact ER-E2 complex. The DBD and HBD contain a constitutive and a stronger ER-induced dimerization function, respectively. Thus, in addition to inducing the activation function associated with the HBD, estrogen plays a crucial role in the formation of stable ER dimers that bind tightly to ERE.