The ligand-bound androgen receptor (AR) regulates target genes via a mechanism involving coregulators such as androgen receptor-associated 54 (ARA54). We investigated whether the interruption of the AR coregulator function could lead to down-regulation of AR activity. Using in vitro mutagenesis and a yeast two-hybrid screening assay, we have isolated a mutant ARA54 (mt-ARA54) carrying a point mutation at amino acid 472 changing a glutamic acid to lysine, which acts as a dominant-negative inhibitor of AR transactivation. In transient transfection assays of prostate cancer cell lines, the mt-ARA54 suppressed endogenous mutated AR-mediated and exogenous wild-type AR-mediated transactivation in LNCaP and PC-3 cells, respectively. In DU145 cells, the mt-ARA54 suppressed exogenous ARA54 but not other coregulators, such as ARA55-enhanced or SRC-1-enhanced AR transactivation. In the LNCaP cells stably transfected with the plasmids encoding the mt-ARA54 under the doxycycline inducible system, the overexpression of the mt-ARA54 inhibited cell growth and endogenous expression of prostate-specific antigen. Mammalian two-hybrid assays further demonstrated that the mt-ARA54 can disrupt the interaction between wild-type ARA54 molecules, suggesting that ARA54 dimerization or oligomerization may play an essential role in the enhancement of AR transactivation. Together, our results demonstrate that a dominant-negative AR coregulator can suppress AR transactivation and cell proliferation in prostate cancer cells. Further studies may provide a new therapeutic approach for blocking AR-mediated prostate cancer growth.