Estrogen receptor-alpha (ER alpha) is downregulated in the presence of its cognate ligand, estradiol (E2), through the ubiquitin proteasome pathway. Here, we show that ubiquitin proteasome function is required for ER alpha to serve as a transcriptional activator. Deletion of the last 61 amino acids of ER alpha, including residues that form helix 12, abolishes ligand-mediated downregulation of the receptor as do point mutations in the ligand binding domain that impair coactivator binding. In addition, coactivators also are subject to degradation by the 26S proteasome, but their intrinsic transcriptional activity is not affected. These data provide evidence that protein interactions with ER alpha coactivator binding surfaces are important for ligand-mediated receptor downregulation and suggest that receptor and coactivator turnover contributes to ER alpha transcriptional activity.