The local recurrence rate of breast cancer has been reported to be unusually high at the surgical scar. Such breast cancer recurrence is believed to be triggered by the release of growth factors into the healing wound. Observations from an animal model have also demonstrated that KGF expression is dramatically induced by creation of full thickness wounds in mouse skin. Since KGF is an epithelial cell-specific mitogen in rat mammary epithelium, it is reasonable to speculate that KGF may be also involved in regulating human breast cancer cell growth. The purpose of the present study was to determine the effect of estradiol-17 on KGF gene expression in normal human breast stromal cells, as well as in human breast cancer stromal cells, and the mechanisms by which estradiol-17 regulates breast epithelial proliferation. Our results show that KGF expression was not effected by estradiol-17 treatment in normal human breast stromal cells. In contrast, KGF expression was stimulated by estradiol-17 in human breast cancer stromal cells. KGF mRNA levels have also been examined in normal human breast stromal cells and human breast cancer stromal cells. An interesting correlation was found between KGF expression and estradiol-17 regulation in these cell types. Normal human breast stromal cells which do not response to estradiol-17 have lower KGF mRNA level than the cancer cells which KGF expression is stimulated by estradiol-17. Our data also demonstrate that recombinant human KGF significantly stimulate normal human breast and human breast cancer epithelial cell proliferation in a dose-dependent manner. Since we have shown that estradiol-17 induces KGF mRNA expression in human breast cancer stromal cells, KGF may be involved at least in part in the stimulatory pathway that is initiated by estradiol-17 in human breast cancer epithelial cells.