Y-box binding protein-1 (YB-1) is an oncogenic transcription/translation factor expressed in >40% of breast cancers, where it is associated with poor prognosis, disease recurrence, and drug resistance. We questioned whether this may be linked to the ability of YB-1 to induce the expression of genes linked to cancer stem cells such as CD44 and CD49f. Herein, we report that YB-1 binds the CD44 and CD49f promoters to transcriptionally upregulate their expressions. The introduction of wild-type (WT) YB-1 or activated P-YB-1 S102 stimulated the production of CD44 and CD49f in MDA-MB-231 and SUM 149 breast cancer cell lines. YB-1-transfected cells also bound to the CD44 ligand hyaluronan more than the control cells. Similarly, YB-1 was induced in immortalized breast epithelial cells and upregulated CD44. Conversely, silencing YB-1 decreased CD44 expression as well as reporter activity in SUM 149 cells. In mice, expression of YB-1 in the mammary gland induces CD44 and CD49f with associated hyperplasia. Further, activated mutant YB-1 S102D enhances self-renewal, primary and secondary mammosphere growth, and soft-agar colony growth, which were reversible via loss of CD44 or CD49f. We next addressed the consequence of this system on therapeutic responsiveness. Here, we show that paclitaxel induces P-YB-1 S102 expression, nuclear localization of activated YB-1, and CD44 expression. The overexpression of WT YB-1 promotes mammosphere growth in the presence of paclitaxel. Importantly, targeting YB-1 sensitized the CD44 High /CD24 Low cells to paclitaxel. In conclusion, YB-1 promotes cancer cell growth and drug resistance through its induction of CD44 and CD49f.