Progesterone (P4), acting through its nuclear receptor (PGR), plays an essential role in ovulation by mediating the expression of genes involved in ovulation and/or luteal formation. To identify ovulatory specific PGR-regulated genes, a preliminary microarray analysis was performed using rat granulosa cells treated with hCG ± RU486 (PGR antagonist). The transcript most highly down-regulated by RU486 was an EST (Expressed Sequence Tag) sequence (gb: BI289578.1) that matches with predicted sequence for Xlr5c-like mRNA. Since nothing is known about Xlr5c-like, we first characterized the expression pattern of Xlr5c-like mRNA in the rat ovary. The level of mRNA for Xlr5c-like is transiently up-regulated in granulosa cells of periovulatory follicles after hCG stimulation in PMSG-primed rat ovaries. The transient induction of Xlr5c-like mRNA was mimicked by hCG treatment in cultured granulosa cells from preovulatory ovaries. We further demonstrated that the LH-activated PKA, MEK, PI3K, and p38 signaling is involved in the increase in Xlr5c-like mRNA. The increase in Xlr5c-like mRNA was abolished by RU486. The inhibitory effect of RU486 was reversed by MPA (synthetic progestin), but not by dexamethasone (synthetic glucocorticoid). Furthermore, mutation of SP1/SP3 and PGR response element sites in the promoter region of Xlr5c-like decreased Xlr5c-like reporter activity. RU486 also inhibited Xlr5c-like reporter activity. ChIP assay verified the binding of PGR and SP3 to the Xlr5c-like promoter in periovulatory granulosa cells. Functionally, siRNA-mediated Xlr5c-like knockdown in granulosa cell cultures resulted in reduced levels of mRNA for Snap25, Cxcr4, and Adamts1. Recombinant Xlr5c-like protein expressed using an adenoviral approach was localized predominantly to the nucleus and to a lesser extent to the cytoplasm of rat granulosa cells. In conclusion, this is the first report showing the spatiotemporally regulated expression of Xlr5c-like mRNA by hCG in rat periovulatory ovaries. P4/PGR mediates the LH-induced increase in Xlr5c-like mRNA. In turn, Xlr5c-like is involved in regulating the expression of specific ovulatory genes such as Snap25, Cxcr4, and Adamts1, possibly acting in the nucleus of periovulatory granulosa cells.