Transcription of the beta-casein milk protein gene in the HC11 mouse mammary epithelial cell line is induced synergistically by the hormones glucocorticoid and PRL. Sequential treatment of HC11 cells with glucocorticoid and PRL demonstrated that the two hormones had different modes of action on beta-casein transcription. Pretreatment with dexamethasone enhanced the response to subsequent induction by PRL, but not vice versa. Dexamethasone increased the sensitivity of the cells to respond to PRL. The increase in sensitivity was slow, extended for 16 days, and could be rapidly reversed by withdrawal of dexamethasone. The dexamethasone-induced sensitivity for the rapid transcriptional regulation by PRL could be observed with transfected rat beta-casein promoter-chloramphenicol acetyltransferase constructs retaining only 175 basepairs upstream from the transcription initiation site. Expression of the endogenous mouse beta-casein gene was regulated identically to that of the promoter constructs with respect to the synergy of the hormones and their different kinetics of action. In contrast to the slow induction of sensitivity toward PRL, dexamethasone rapidly induced the transcription of a mouse mammary tumor virus long terminal repeat controlled gene in HC11. This demonstrated a normal transcriptional activation of the glucocorticoid receptor in this cell line. Thus, glucocorticoid may regulate beta-casein gene transcription indirectly, inducing or repressing other glucocorticoid-regulated genes, whereas the interaction of PRL with its receptor causes a rapid induction of the beta-casein gene promoter.