Estrogen receptor-alpha (ERalpha) functions as a ligand-activated transcription factor that alters expression of estrogen-responsive genes in target cells. Numerous regulatory proteins interact with ERalpha to influence estrogen-mediated transactivation. We have identified a novel coregulatory protein, template-activating factor-Ibeta (TAF-Ibeta), which binds to ERalpha in vitro when the receptor is not complexed with an estrogen response element. The central region of TAF-Ibeta interacts with both the DNA-binding domain and the carboxy-terminal region of ERalpha. Coimmunoprecipitation experiments demonstrate that TAF-Ibeta is associated with the unoccupied, but not the estrogen-occupied, ERalpha in MCF-7 breast cancer cells. Overexpression of TAF-Ibeta inhibits ERalpha-mediated transcription in a dose- dependent manner. TAF-Ibeta represses p300-mediated acetylation of histones and ERalpha in vitro and decreases ERalpha acetylation in vivo. TAF-Ibeta also binds to other nuclear receptor superfamily members and represses thyroid hormone receptor beta- induced transcription in transient transfection assays. Taken together, these data provide evidence that TAF-Ibeta regulates transcription of estrogen- responsive genes by modulating acetylation of histones and ERalpha and that the effects of TAF-Ibeta extend to other nuclear receptor superfamily members as well.