Expression of cyclooxygenase 2 (COX-2) in breast cancer correlates with poor prognosis, and COX-2 enzyme inhibitors reduce breast cancer incidence in humans. We recently showed that COX-2 overexpression in the mammary gland of transgenic mice induced mammary cancer. Because prostaglandin E2 (PGE2) is the major eicosanoid and because the EP2 subtype of the PGE2 receptor is highly expressed in the mammary tumors, we tested if this G protein-coupled receptor is required for tumorigenesis. We crossed the MMTV-COX-2 transgenic mice with Ep2-/- mice and studied tumor development in bigenic mice. Lack of EP2 receptor strongly suppressed COX-2-induced effects such as precocious development of the mammary gland in virgins and the development of mammary hyperplasia in multiparous female mice. Interestingly, the expression of amphiregulin, a potent mammary epithelial cell growth factor was down regulated in mammary glands of Ep2-/- mice. Total cyclic AMP (cAMP) levels were reduced in Ep2-/- mammary glands suggesting that PGE2 signaling via the EP2 receptor activates the Gs/cAMP/protein kinase A pathway. In mammary tumor cell lines, expression of the EP2 receptor followed by treatment with CAY10399, an EP2-specific agonist, strongly induced amphiregulin mRNA levels in a protein kinase A-dependent manner. These data suggest that PGE2 signaling via the EP2 receptor in mammary epithelial cells regulate mammary gland hyperplasia by the cAMP-dependent induction of amphiregulin. Inhibition of the EP2 pathway in the mammary gland may be a novel approach in the prevention and/or treatment of mammary cancer.