Estrogen receptor β (ERβ) promotes the degradation of hypoxia inducible factor 1α (HIF-1α), which contributes to the ability of this hormone receptor to sustain the differentiation of epithelial and carcinoma cells. Although the loss of ERβ and consequent HIF-1 activation occur in prostate cancer with profound consequences, the mechanism by which ERβ promotes the degradation of HIF-1α is unknown. We report that ERβ regulates the ligand (3β-adiol)-dependent transcription of prolyl hydroxylase 2 (PHD2) also known as Egl nine homolog 1 (EGLN1), a 2-oxoglutarate-dependent dioxygenase that hydroxylates HIF-1α and targets it for recognition by the von Hippel-Lindau tumor suppressor and consequent degradation. ERβ promotes PHD2 transcription by interacting with a unique estrogen response element in the 5′ UTR of the PHD2 gene that functions as an enhancer. PHD2 itself is critical for maintaining epithelial differentiation. Loss of PHD2 expression or inhibition of its function results in dedifferentiation with characteristics of an epithelial-mesenchymal transition, and exogenous PHD2 expression in dedifferentiated cells can restore an epithelial phenotype. Moreover, expression of HIF-1α in cells that express PHD2 does not induce dedifferentiation but expression of HIF-1α containing mutations in the proline residues that are hydroxylated by PHD2 induces dedifferentiation. These data describe a unique mechanism for the regulation of HIF-1α stability that involves ERβ-mediated transcriptional regulation of PHD2 and they highlight an unexpected role for PHD2 in maintaining epithelial differentiation.T he role of estrogen receptors (ERs), which are transcription factors belonging to the steroid/thyroid nuclear receptor superfamily (1-3), in regulating epithelial differentiation is an emerging area of considerable biological interest and pathological relevance. In the prostate, the discovery of ERβ (4, 5) has generated intense interest in the roles played by this ER in several tissues including prostate and breast epithelia (6-11). Increasing evidence supports the hypothesis that ERβ functions to maintain epithelial differentiation in the prostate and breast (9,10,12,13). In the normal prostate, ERβ contributes to epithelial differentiation as evidenced by the observation that ERβ knockout mice exhibit altered differentiation in the ventral prostate, whereas the glands of ERα knockout mice lack these lesions and appear to be normal (12). ERβ in human prostate cancer is of substantial relevance because there is an inverse relationship between the expression of ERβ and highly invasive prostate cancer (9,14). In pursuit of a functional basis for this relationship, we demonstrated that ERβ sustains an epithelial phenotype and impedes a mesenchymal transition in prostate cancer and we identified a metabolite of dihydrotestosterone, 5α-androstane-3β,17β4-diol (3β-adiol) as the specific ERβ ligand that mediates this function (9). This observation is in agreement with the recent findings that 3β-adiol is a natural ligand for ERβ in ...