Regulation of progesterone receptor (PR) by estradiol-17β (E₂) in mouse uterine and vaginal epithelia was studied. In ovariectomized mice, PR expression was low in both vaginal stroma and epithelium, but high in uterine epithelium. E₂ induced PR in vaginal epithelium and stroma, but down-regulated PR in uterine epithelium. Analysis of estrogen receptor α (ERα) knockout (ERKO) mice showed that ERα is essential for E₂-induced PR expression in both vaginal epithelium and stroma, and for E₂-induced down-regulation, but not constitutive expression of PR in uterine epithelium. Regulation of PR by E₂ was studied in vaginal and uterine tissue recombinants made with epithelium and stroma from wild-type and ERKO mice. In the vaginal tissue recombinants, PR was induced by E₂ only in wild-type epithelium and/or stroma. Hence, in vagina, E₂ induces PR directly via ERα within the tissue. Conversely, E₂ down-regulated epithelial PR only in uterine tissue recombinants constructed with wild-type stroma. Therefore, down-regulation of uterine epithelial PR by E₂ requires stromal, but not epithelial, ERα. In vitro, isolated uterine epithelial cells retained a high PR level with or without E₂, which is consistent with an indirect regulation of uterine epithelial PR in vivo. Thus, E₂ down-regulates PR in uterine epithelium through paracrine mechanisms mediated by stromal ERα.