The orphan receptors COUP-TFI and COUP-TFII play an important role in development and differentiation by activating specific genes and by modulating the activity of nuclear receptors including estrogen receptor alpha (ER alpha) and retinoic acid receptors (RARs). Previously, it was demonstrated that the expression and activity of ER alpha and RARs are lost or impaired in anti-estrogen-resistant breast cancers. Here we show that, similar to ER alpha and RARs, the expression of COUP-TFII but not COUP-TFI is reduced in similar to 30% of breast cancer cell lines. introduction of COUP-TFII to MDA-MB-435 cells resulted in reduced growth and plating efficiency. Interestingly, COUP-TFII increased the expression of cyclin D1 and p21(WAF1/CIP1) in MDA-MB-435 cells. Although parental and COUP-TFII-transduced cells progressed through the G1-S phase at a similar rate, progression of COUP-TFII cells through the G2/M transition phase was delayed. The activity of cdk2 required for G2/M progression was reduced in COUP-TFII cells compared to parental cells. This property of COUP-TFII is distinct from that of ER alpha and RARs, which usually modulate the G1 phase of breast cancer cells. Furthermore, these results reveal an important physiological function of COUP-TFII, which correlates with its ability to induce gene expression rather than modulation of nuclear receptor activity.