We have shown previously that estradiol stimulates cell proliferation and progesterone receptor (PgR) synthesis in luminal epithelial cells of the normal human breast. Approximately 10-15% of luminal epithelial cells within the normal breast express immunodetectable estrogen receptor (ER), but little is known about their distribution within lobules and their organization in relation to the smaller population of proliferating cells. Using normal human breast tissue, we show that ER-positive cells are distributed evenly throughout the mammary epithelium. Using double antibody immunofluorescence, we show that 96% of steroid receptor-positive cells synthesize both ER and PgR (n = 25). Double labeling with antibodies to either ER or PgR coupled with either [3H]thymidine histoautoradiography or with antibodies to the Ki67 proliferation antigen indicates that dividing cells are separate from those expressing the receptors (although they are often in close proximity). However, in contrast to the normal human breast, two-thirds of ER-positive human mammary tumors examined (n = 19) have a high proportion of dividing cells that are ER positive. These data are consistent with the hypothesis that cells in normal human breast epithelium are hierarchical in organization and support a model in which proliferation of ER-negative cells is controlled by paracrine factors released from ER-positive cells under the influence of estradiol. This organization may be disrupted in some tumors.