The signal transducer and activator of transcription 6 (Stat6), a member of the family of DNA-binding proteins, has been identified as a critical cell differentiation modulator in breast cancer cells. As of yet, the mechanisms underlying this function have remained largely unknown. To further elucidate the role of Stat6 in breast cancer development, we investigated the consequences of exogenous Stat6 expression.Proliferation assays and flow cytometry assays were conducted to evaluate the putative role of Stat6 on cell proliferation. To this end, we produced synchronized cells after a double thymidine block, as confirmed by FACS analysis. mRNA levels of Stat6 were measured by RNase protection analysis. To confirm the interaction among proteins, we employed GST pull-down assays and immunoprecipitation assays. Luciferase assays and ChIP assays were used to assess the transcriptional activity.Compared to control breast cancer cells, we found that exogenous Stat6 expression plays a critical role in controlling cell proliferation. Also in different breast tumor cell lines, endogenous Stat6 expression was found to be positively related to a lower proliferation rate. Interestingly, in human breast cancer cells Stat6 functions in G1/S cell cycle progression, and the growth-inhibitory effect of Stat6 was shown to be mediated by induction of the G1 cyclin-dependent kinase inhibitors p21(Cip1/WAF1) (p21) and p27(Kip1) (p27). Simultaneously, G1-related cyclin/cyclin-dependent kinase activities and pRB phosphorylation were markedly reduced, and cell cycle progression was blocked in the G1 phase. Stat6 knockdown resulted in enhanced cell proliferation and a decrease in p21 and p27 mRNA levels in the steroid-responsive and non-responsive T-47D and MDA-MB-231 cell lines, respectively. In addition, the stimulatory effect of Stat6 on p21 and p27 gene transcription was found to be associated with interaction of Stat6 with the transcription factor Sp1 at the proximal Sp1-binding sites in their respective promoters.Together, these results identify Stat6 as an important cell differentiation regulatory protein functioning, at least in part, by interacting with Sp1 to activate the p21 and p27 gene promoters in breast cancer cells.