Steroid hormones induce transcription from the mouse mammary tumor virus (MMTV) promoter by complex mechanisms requiring binding of the hormone receptors to the hormone responsive element (HRE) of the long terminal repeat region. Here we show that the MMTV promoter contains two degenerated octamer motifs immediately upstream of the TATA box that together bind OTF-1 (Oct-1, NFIII) with an affinity similar to the octamer consensus. In transfection experiments, mutation of these octamer motifs interferes with the hormonal response of the MMTV promoter. In vitro, these mutations do not influence basal transcription but completely abolish the stimulatory effect of purified progesterone receptor. Progesterone receptor and glucocorticoid receptor bound to the HRE facilitate binding of OTF-1 to the two octamer motifs. Thus, OTF-1 is a natural mediator of hormonal induction of the MMTV promoter and acts through cooperation with the hormone receptors for binding to DNA.